Why Wal-Mart can NOT afford to pay workers a $15 minimum wage

CNBC reports:

Wal-Mart's actual profit, according to SEC filings, was only 3 percent of its total revenue. That works out to roughly $6,400 dollars in profit for each of the company's 2.3 million employees—a profit that could be wiped out with a $15 minimum wage.

Labor advocates are also fond of appealing to their readers' sense of fairness by arguing that CEO pay at the company proves it can afford a $15 minimum wage. But the math here also doesn't add up. Wal-Mart CEO Doug McMillon earned a combined $19.4 million compensation package in 2015, including salary, stock options, and other perks. That makes for a dramatic sound bite. But if this money was somehow divided between all 2.3 million Wal-Mart associates, each associate would get a one-time $8.43 bonus—that's it.

The fights for $15 have even tried to appeal to conservative hearts by arguing that the higher pay requirement will reduce employees' need for public support programs. It's debatable whether this argument is offered in good faith: California Assemblyman Kevin McCarty (D., Sacramento) recently let slip his mask of concern for the taxpayer when he and his fellow legislators pushed to raise the income thresholds for a public program so that recipients of the state's new $15 minimum wage could still qualify for state benefits. So much for ending welfare as we know it.

More importantly, the data doesn't support this notion of a taxpayer windfall following minimum wage increases. In a report last year, Joseph Sabia and Thanh Tam Nguyen of San Diego State University examined 35 years of government data across a number of different datasets. Their results suggest that, on net, minimum wage increases have little to no ameliorating effect on participation in (or spending on) a range of means-tested programs.

The demand for labor is always a downward sloping curve no matter what statists tell you.