This line of thinking always bothers me. It turns out that compared to WalMart/Sam’s Club, Costco allows unions, pays their workers more, gives better health coverage, charges less for their goods, and still nets a better profit per store. But WalMart is not going away — because sustainability and efficiency are not the governing logic of our economic system.

Walmart and Costco have very different hiring policies. Walmart basically hires anyone, whereas Costco is much more selective in whom it hires. Therefore, Costco is more worried about retaining its employees than Walmart. If you want more skilled and more eperienced employees, you’ve got to offer better wages and benefits.

Let me ask you this. If you were put in a room with random floor workers from Costco and from Walmart, and they weren’t wearing their uniforms and wouldn’t tell you where they worked, how long do you think it would take, by having conversations with them, which ones worked at Walmart and which ones worked at Costco?

Costco has a significantly higher revenue and profit per employee than Walmart, as Costco sells much more in higher-end items than Walmart.

So the two companies, while both retail stores, have fairly different models. Walmart / Sam’s is purely mass market: sell lots of cheap stuff. Costco is a bit higher end: not as many poor people shop there as at Walmart.

However, if something was truly beneficial for business, they’d have already done it.

This line of thinking always bothers me. It turns out that compared to WalMart/Sam’s Club, Costco allows unions, pays their workers more, gives better health coverage, charges less for their goods, and still nets a better profit per store. But WalMart is not going away — because sustainability and efficiency are not the governing logic of our economic system.

All this testimony from various businesses, consultants, etc. says that businesses would be better off if they adopted the unlimited sick day policy. However, if something was truly beneficial for business, they’d have already done it. So while paid sick leave may or may not be something the legislature should pass, don’t try to sell it as something that is good for business, because they can make that determination themselves.

I think a more sensible way to frame the argument in favor of paid sick days, at least for employees that are in food service or deal with the public, is that by forcing them to work when they are sick, the business essentially pushes the cost of that onto everyone else (by making the rest of us sick).

GMR, there’s a lot of good money to be made by pushing costs “onto everyone else.” If I was the CEO of a big chain of restaurants, and could save 2% of my short term labor costs by not offering any paid time off, I’d be able to justify writing myself a big bonus check at the shareholder’s meeting. Granted, I’d lose a lot of talented people to better jobs, and maybe a bunch of my customers get sick from my sick employees coughing in the dining room. But by the time anyone realizes that my workers and managers are inefficient because of the high turnover rate, I’ll have made my millions and will be off to a new gig. And by the time the customers realize they’re sick, they won’t know whether they caught it from the underpaid people in my restaurant or the underpaid people in the bookstore or wherever else.

Turns out that while specific individuals running a business can make rational decisions in their own best interest, they’re often pretty shite at solving systematic problems. (See: tragedy of the commons problem. Or, come to think of it, GM, Ford, et al — in retrospect, they made great short-term decisions with tragic long-run consequences.)

I think a more sensible way to frame the argument in favor of paid sick days, at least for employees that are in food service or deal with the public, is that by forcing them to work when they are sick, the business essentially pushes the cost of that onto everyone else (by making the rest of us sick).

Don’t take Jon’s word for it.

Don’t worry – many of us won’t.

Read “Contagion Nation: A Comparison of Paid Sick Day Policies in 22 Countries” at CEPR’s website here:
http://www.cepr.net/documents/publications/paid-sick-days-2009-05.pdf

Then urge your elected officials to show real leadership on this vital public health issue and pass the paid sick days bill now.