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Nearly 100 businesses have closed and about 300 jobs have been lost in Austin as a result of the Wal-Mart opening in the community in 2006, a new report released Friday shows.
The study was conducted by the University of Illinois-Chicago and Loyola University, surveying 300 businesses located near the Wal-Mart at 4650 W. North Ave., just east of Cicero Avenue.
Researchers surveyed the businesses located in Wal-Mart’s 60639 zip code and in neighboring zip codes in 2007, 2007 and 2008. Since its opening, 82 businesses that sold items similar to those found at Wal-Mart have closed. The study also found that while Wal-Mart itself has employed about 300 workers, another 300 jobs were lost to the community as businesses shut down.
As for a direct connection between Wal-Mart and the loss of jobs and businesses, researchers acknowledged that such a conclusion could not be easily drawn. But David Merriman, head of UIC’s economics department and a researcher on the study, stressed that the report’s findings show a pattern of consistent failure on the part of the big-box retailer to make significant contributions to the local economy.
He also questioned the company’s insistence that its only impact on communities after moving in is only positive.
“I don’t understand why they continue to take that position, which, quite frankly, doesn’t make sense as far as economic theory or common sense,” he said.
Merriman said that their research showed that for every one job the company created, the Austin community lost a job. Concerning the Austin Wal-Mart’s assertion that it employs 426 workers – 310 as “sales associates” – the study argues that many of those associates worked part time, and that the overall workforce is closer to 320 full-time workers. He added that the research showed no significant revenue generated in those zip code areas, including in the retailer’s.
“The main finding is that job creation is a wash and there has been no new sales tax revenue,” he said.
But Ald. Emma Mitts, whose 37th Ward includes Wal-Mart, disputes the entire study and its methodology. She said of the businesses that closed since 2006, they were struggling and headed for closure before Wal-Mart was built.
Mitts added that the store has given people in the community jobs that they wouldn’t have had, and that the store has generated millions of dollars in revenue. The alderman also argued that area businesses such as the Walgreens, just a block west on North Avenue, has experienced greater foot traffic as a result of Wal-Mart’s presence.
Mitts fought since 2003 to have the retailer open in Austin and said its impact has been positive for the community.
“I’m proud of that,” she said. “I have not seen any negative impact. I was stunned and shocked by this report. All I’ve heard from people in the community is how can they get a job at Wal-Mart. I even have seniors who ask me how they can work there.
“None of those businesses came to me and said, ‘Wal-Mart made me close,'” Mitts added. “I don’t see that. I see improvement. I see us creating jobs. You don’t hear these complaints about the Wal-Marts in the suburbs, but why when it’s in our community?”
The City Council was scheduled to meet on Monday about the prospect of opening a Wal-Mart on the South Side, but that meeting was cancelled.