No. of Recommendations: 1
Selena, I think you're being a little naive about this.

The drop wouldn't be an annual thing -- it would just be resetting the bar lower, and then letting it gradually rise again

Assuming everything was static (it isn't) the drop would be from $8B to $7B in profits every year. Heck the hit might increase with costs. However, to think increasing profits due to growth/inflation/other sources is just going to make this "hit" go away is a little presumptuous. It's a 12.5% hit!

Granted, retraining costs, morale and reputation would probably improve. It would certainly be an interesting case study.

To expect them to cough up $1,000 or more per year for health insurance only makes things worse.

At that point, if you are expecting Walmart to foot the whole bill your looking at about $2B a year, or 25% of last year's profits. Also, some of that would be a taxable expense that would have to be deducted from the employee's pay.

Maybe there is someone with some experience in this that could provide some more definate numbers for the USA and a company of this size. I'll do some digging.

Finally, I'm not saying "Let those whiners get a job" I'm just trying to present an approximation of the cost of the plan you proposed to Walmart and what the ramifications might be. Like I said it would be an incredibly interesting case study for some MBA candidate.

Simon
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