Dive Brief:

• Despite high-profile bumps in hourly pay, retail workers continue to qualify for government subsidies like food stamps and health care programs even as the companies themselves enjoy tax incentives and other government monies, according to a new tracker released by worker advocacy organization Good Jobs First.

• The tracker is a national search engine that shows economic development subsidies and other forms of government financial assistance to businesses. It has found 1,858 companies, some of them publicly traded and many of them retailers, that receive government subsidies separate from welfare benefits that go to their workers.

• Meanwhile, the Governmental Accounting Standards Board (GASB), which releases the generally accepted accounting principles (GAAP) used by state and local governments in the United States, has released new standards that require state and local governments to report how much revenue they give in corporate tax breaks given for economic development.

Dive Insight:

Wal-Mart’s recent bump in its hourly pay to workers will cost the company an estimated $1 billion. But, especially for part-time workers, that pay still fails to provide a living wage and qualifies many of them for government-subsidized health care and food programs. That is, the new hourly wages of $9 and $10 announced by Wal-Mart, Gap, TJX, and others, which are above the $7.25 an hour minimum stipulated by the federal government and many states, are still essentially “poverty wages.”

Yet many of these companies are also benefiting from tax breaks. Wal-Mart, for example, received some $174 million through 308 state and local programs, mostly since 2009, according to the tracker.

That situation has led several jurisdictions to boost hourly minimum wages to $15 an hour, which is closer to what some labor experts call a “living wage.”

But even that higher minimum doesn’t calculate to a living wage in some areas where the cost of living is also higher. The Massachusetts Institute of Technology has developed a “living wage calculator” that determines what a living wage really is in various areas in the country. Ikea is among those retailers basing its minimum pay on the MIT calculator. 

Furthermore, Good Jobs First says that retailers should provide workers with better pay and more than part-time hours so that state and local governments don’t have to subsidize them. The situation means that many retailers are double dipping, according to Good Jobs First.

“Taxpayers are essentially subsidizing the companies two times,” said Good Jobs First research director Philip Mattera. “There is already a proliferation of poverty-level jobs at companies that could well afford to pay their employees better and provide better benefits.”