Evidence about Wages and Working Conditions
Not too long ago, getting a job at a major supermarket was an entry into the middle class. Most workers worked full-time. A job in the grocery industry meant that one could make ends meet, afford decent housing, provide adequate meals for one’s family, even take a vacation and save some money for a rainy day. That is no longer the case, as this report documents.
The largest independent survey of retail workers that has ever been conducted in the United States provides the foundation for this report. It was carried out at the request of United Food and Commercial Workers locals 7, 21, 324, and 770 to provide reliable, evidence-based analysis about the working and living conditions of Kroger workers.
Three regions with 36,795 Kroger workers were surveyed: The Puget Sound region of Washington, the State of Colorado, and Southern California. Completed surveys were received from 10,287 workers for a 28 percent response rate.
The living and working conditions of Kroger workers have declined markedly over the past 20 years. Kroger’s current low-wage, part-time workforce strategy relies on poorly-paid, part-time workers with constantly changing schedules.
Even though food surrounds Kroger grocery workers every hour on their job, over three-quarters of Kroger workers are food insecure, based on the U.S. Department of Agriculture food security assessment tool. These workers cannot afford balanced and healthy food. They run out of food before the end of the month, skip meals, and are hungry sometimes. Those with children report they go hungry to provide food and other essentials for their children. Kroger workers’ exceptionally high rate of food insecurity is seven times greater than the U.S. average.
Workplace safety represents another crucial challenge for Kroger workers. We all must eat. Grocery stores have remained open and grocery workers continue to be the essential frontline workforce for providing food to their communities where the COVID pandemic has caused pervasive public apprehension about health risks, social isolation, financial uncertainty, and anxiety about obtaining food and household necessities.
Kroger management’s cost-cutting practices have compromised personal, health and food safety in stores. Not surprisingly, workers report high rates of depression and anxiety resulting from their unsafe and insecure working conditions.
At the same time Kroger font-line jobs have declined from middle class to marginal poverty wage and working conditions, the company significantly grew its revenues, profits, and compensation for its top executives. In addition, Kroger’s buy-back stock practices have resulted in high returns to its stockholders. Meanwhile workers struggle with lower cost-of-living pay and challenging work requirements.
The data demonstrate that workers’ financial distress, housing insecurity and food insecurity are not resulting from their personal failures but rather, from Kroger’s companywide policies for cutting costs and increasing profits. These conditions are documented in this report.
Wages and Economic Conditions
Kroger is the only employer for 86 percent of their workers, making it their sole source of earned income. Working full-time to earn a living wage would require Kroger to pay $22 per hour for an annual living wage total of $45,760. The average annual earnings of Kroger workers, however, equal $29,655. This is $16,105 short of the annual income needed to pay for basic necessities required for the living wage.
More than two-thirds of Kroger workers struggle for survival due to low wages and part-time work schedules. Nine out of ten Kroger workers report that their wages have not increased as much as basic expenses such as food and housing have increase. Since 1990, wages for the most experienced Kroger food clerks have declined from 11 to 22 percent (adjusted for inflation) across the three regions surveyed. Across the entire grocery industry, 29 percent of the labor force is below or near the federal poverty threshold.
Nearly two-thirds of Kroger workers say they do not earn enough money to pay for basic expenses every month. Among the workers who are unable to afford necessities, 44 percent say they are unable to pay for rent and 39 percent say they are unable to pay for groceries. Fourteen percent of Kroger workers are homeless now or have been homeless during the past year.
A significant number of Kroger workers of all ages face economic hardship, but it is most prevalent among young workers. Among workers 21 to 29, 53 percent are unable to pay for rent.
More than two-fifths of Kroger workers report that in the past year, they had to borrow money from their family or friends to pay for basic expenses. There is no end in sight for most workers. More than nine out of ten say they will not have enough money to support themselves after they retire.
How can workers’ living wage challenges be addressed? Many part-time workers reported that they would like to work more hours. Kroger workers’ could be employed full-time at a minimum hourly wage of $22 Alternately, part-time workers, who currently average 1,560 annual working hours, could be paid a premium hourly wage of $29.33, for continuously changing schedules.
Kroger says that its purpose is to “feed the human spirit,” but falls short in using its abundant food resources to meet the essential needs of its front-line employees. Kroger provides its employees a shallow and narrow discount of 10 percent on Kroger brand groceries, which excludes fresh produce. This discount falls far short of enabling employees and their families to eat healthy and balanced meals.
Among Kroger workers who are single parents, 85 percent are food insecure. This means that after their workday of putting food in the hands of other people, they return to their homes and are unable to provide the nutritious food that their children need to be healthy.
Food is part of a bundle of necessities that include transportation, apparel, utilities, housing, health care, and childcare. Workers who cannot afford other necessities – housing, clothing, and transportation – also cannot afford nutritious meals.
Housing and Homelessness
Fourteen percent of Kroger workers are homeless now or have been homeless during the past year. The rate of homelessness decreases as earnings increase. However, because Kroger’s wage structure is depressed and part-time employment is so prevalent, homelessness still occurs among workers in the top wage bracket. Even among full-time employees, nine percent have experienced homelessness.
Thirty-six percent of Kroger workers say that they worry about being evicted. Concern about eviction increases with age until workers are in their mid-fifties. This corresponds with the years when workers are most likely to have children in their households.
At the time of the survey during the summer of 2021, 18 percent of Kroger workers had not paid the previous month’s rent or mortgage on time. Over a quarter of Kroger workers have no confidence or only slight confidence that they will be able to pay their next rent or mortgage payment on time. This kind of housing insecurity is greatest among young, part-time employees with low hourly wages, and among African American, Native American and Latino workers. But even 15 percent of full-time employees couldn’t pay the rent or mortgage bill.
Forty-four percent of Kroger workers live in inadequate housing. This includes doubling up with another family or unrelated individual, living in a unit that is too small for the household and being overcrowded, multigenerational housing where grandparents and parents live with their adult children, and homelessness.
Workload and Schedule
Less than a quarter of Kroger workers think the company is headed in the right direction. The most senior workers, who are the backbone of Kroger’s workforce, voice the strongest critical assessments.
Seventy-three percent of Kroger workers say they are not fairly compensated based on their experience and the work that they do. Even though most of them rely on Kroger as their sole source of income, two-thirds of Kroger workers say that working for Kroger is a short-term job rather than a career opportunity because of low pay and short staffing at stores.
Company labor policies are responsible for workers’ frustrations. Two-thirds of workers report that Kroger has increased the amount of work that they have to complete during their shift. Over three quarters of workers say that there are not enough workers at their store to provide good customer service, and that are not able to complete all of the assigned tasks at their store.
Kroger’s just-in-time scheduling practices cause additional insecurity, with detrimental impacts for childcare or those seeking additional, part-time employment elsewhere to supplement Kroger’s pay. Over half of Kroger workers have work schedules that change at least every week, and 13 percent have schedules that change every day. A quarter of workers are told about schedule changes the same day or only one day in advance. Another one-third get 2 to 5 days’ notice of schedule changes. Only 16 percent of workers have schedules that do not change.
Kroger’s labor force clearly recognizes that the unpredictable schedule and intense work demands make it difficult for workers to fulfill their responsibilities as family members (including as parents) and as workers. Workers strongly back the idea that Kroger should support their co-workers who are parents by subsidizing the cost of childcare.
Turnover at Kroger is high. The number of workers leaving Kroger has increased four-fold since the onset of COVID. Departures are caused by workers’ safety concerns and desire for better opportunities.
Workplace Safety, Fairness and Respect
Most Kroger workers are proud of the work they do but feel that the company underpays and disrespects them. As a result, the longer employees work at Kroger, the more critical they are of the company’s practices toward workers and consumers.
The COVID pandemic has impacted frontline grocery workers through direct infection and through disruption of civility in grocery stores. Kroger workers feel physically unsafe at work. Especially during the pandemic, workers had to deal with angry and abusive customers and people with erratic behavior within the store.
Despite widespread evidence of greater needs, Kroger has failed to provide adequate security and staffing in the stores. Workers report that inadequate staffing results in unfinished food handling and cleaning work. These staffing shortfalls reduce the quality of food and services and jeopardizes the health and safety of customers.
Over two-thirds of the workers report having difficult experiences with customers during the pandemic. The most frequent problems were customers who refused to wear masks, were verbally abusive, or refused to maintain social distance. A quarter of Kroger workers were confronted by customers who threatened violence, and over a fifth had violent incidents in their store.
According to Kroger workers, store managers did not support workers in a majority of the cases where workers were confronted by abusive or violent customers. Workers report that the overriding management priority during the COVID pandemic has been to maximize store sales over employee safety.
Workers also feel vulnerable to getting COVID. Workers complain that Kroger has failed to enforce well-recognized health standards, such as social distancing and mask wearing among customers.
Workplace stress has a direct impact on the emotional well-being of workers. Over three-quarters of Kroger workers say that their workplace stress follows them home in the form of ongoing depression and anxiety.
A third of workers say that managers change work schedules to retaliate against workers who they do not like. Over a fifth of workers who report such retaliatory management practices are, or recently have been, homeless. This suggests that loss of earnings as a result of arbitrary reductions in hours of work causes some workers to become homeless.
Nearly half of Kroger workers report that store managers unfairly treat some workers better than others. Workers say that managers are not held accountable for their wrongdoing and favoritism.
Despite all these challenges the share of workers who express pride in their work increases with age and seniority. Two-thirds of workers say what they like best about the job at their store is their co-workers. The bond that workers build among themselves as they cooperate to solve problems on the job and withstand economic adversity outside the job represents a rewarding and sustaining outcome from their work at Kroger. These findings suggest that with living wage pay and adequate workplace staffing, Kroger could build a strong and loyal workforce.
Kroger is the largest supermarket chain in the United States and one of the largest corporations in terms of revenues ($132.5 billion, #17) and employees (465,000, #4). It earned $4.05 billion in operating profits in 2020. Unlike many other companies, Kroger has prospered during the COVID-19 pandemic as consumers spent more money buying food in grocery stores (in-person and on-line) and less money in restaurants.
Kroger has not shared the corporation’s prosperity with its front-line employees. Food clerks with the most seniority and at the top of their wage scale have seen a significant decrease in their real wages. A similar pattern of wage stagnation and decline has been the reality for other Kroger front-line workers.
The pay for Kroger’s CEO has increased 296 percent over the past decade and is now 909 times greater than the median pay for company employees. This is one of the largest CEO-worker pay gaps of any major American company. As Kroger’s stock price increased, the company recently adopted a stock buyback program that enriched its largest shareholders rather than invest in its front-line workers.
For two months at the start of the pandemic, Kroger provided its front-line grocery store employees with additional pay, but after two months withdrew that extra pay just as the pandemic conditions were getting worse. When local governments proposed mandating such “hazard pay” to reflect the harmful and arduous conditions facing grocery workers, Kroger forcefully opposed these laws, lobbying elected officials to vote against them, just as Kroger has fought efforts by local and state governments to raise the minimum wage.
Kroger’s business practices alienate and frustrate its front-line employees and thus undermine the personal ties between workers and consumers. Their treatment of workers is not sustainable in the long run. Kroger has the resources to do better. It can become a more responsible employer by investing in its employees and its communities.
Economic Benefits of a Living Wage for Kroger Workers
Raising the minimum hourly wage and scheduled hours for front-line Kroger workers to provide annual earnings of at least $45,760 a year will generate $624 million more in annual earnings for workers represented by the four UFCW locals that participated in this study. This will create two waves of economic multiplier impacts in those geographic regions.
The first wave of impacts will be from this increase in their spending power, which will create 6,573 new year-round jobs and $1.2 billion in added local sales in Denver, Seattle, Los Angeles County, and Orange County, and their surrounding areas.
These wage increases will reduce workers’ dependence on the social safety net. A consequence of low wages is that taxpayers are subsidizing Kroger by providing vital financial assistance to its low-paid employees. After the increase to a living wage, public assistance outlays in the four regions covered by this study will decrease by $68 million. This includes federal-funded, locally administered SNAP, Medicaid and cash aid benefits.
The second wave of impacts will come from a wage bump for grocery workers who already an annual living wage above $45,760 per year but whose pay will be increased to prevent wage compression with lower-paid workers when their wage is raised. Their aggregate raise of $127 million will support an additional 1,341 new local, year-round jobs and $249 million in added local sales in the four areas represented in this study.
Occupation and Skill Change in the Grocery Industry
Grocery stores are a growing industry, and should be expanding their benefits and training for employees who are supporting that growth. Expenditures for groceries in the United States have grown one percentage point a year over the past 20 years. As a result, overall grocery sales in the U.S., adjusted to 2020 dollars, increased from $536 billion in 2000 to $649 billion in 2020.
These increased sales have been supported by increased productivity. A quarter of a million dollars of groceries are now sold annually for every grocery worker.
The occupations employed in grocery stores are steadily changing. The number of grocery store cashiers has declined 18 percent in the past 20 years. This decline has been offset by growth in food preparation, nonfood merchandise sales and customer service jobs.
Grocery industry employment is projected to decline eight percent over the next decade. A significant part of this decline will be loss of cashier jobs, which are projected to shrink by 17 percent.
Changes in the occupational composition of the grocery industry indicate that stores are relying less on personal salesmanship and more on merchandising, including on-line shopping. The next generation of grocery workers will require even more skills. Grocery workers report seeing their jobs moving increasingly toward functioning within complex systems that require critical thinking, coordination with other workers, budgeting time, system monitoring, comprehending written information, and assessing the costs and benefits of different courses of action.
Private-Public Actions to Reduce Food Insecurity
All American metropolitan areas have “food deserts” – areas without full-service grocery stores. As a result, residents of these communities buy most of their food as convenience stores, where prices are high, the choices are few, the food is less healthy (filled with more sugar), the milk and other items are often out-of-date, and there is little fresh produce. This is a major cause of higher rates of obesity and poor health in America’s low-income neighborhoods. America’s largest grocery chains, including Kroger, have abandoned many of the nation’s low-income areas. One measure of this scarcity is that poorer households have fewer square feet of grocery store footprint per capita than households that are more affluent.
Public actions to promote greater access to healthy foods tend to subsidize existing grocery chain businesses through loans and grants, plus the buying power of SNAP benefits received by low-income shoppers. The vision for these programs needs to expand to include sustainable terms of employment for grocery workers.
Kroger receives government subsidies for building its warehouses and grocery stores. Government subsidies for Kroger should be linked to its investments in low-income areas that lack sufficient grocery options – food deserts. If Kroger and other major grocery chains fail to locate stores in these low-income areas, there are alternative ways to eliminate food deserts. Community-owned, consumer-owned, and employee-owned nonprofit food cooperatives offer another model for distributing fresh food. Food co-ops have succeeded in urban and rural settings for decades. With public support, food cooperatives can also offer a better standard for grocery worker jobs, especially if employees are unionized. As a condition of opening stores in more affluent areas, Kroger should be required to provide financial assistance to food cooperatives that provide a diversity of healthy and affordable food and pay living wages.
In a growing number of cities, Food Policy Councils are hubs for the healthy food systems advocacy, and sometimes organized under the auspices of local government. They are often the best “big tent” for unifying food diverse regional constituents, such as social justice advocates and organized labor, food and nutrition advocates, public agencies, large institutions (such as school districts and hospitals), and environmental and public health advocates. Labor unions should be active participants in these efforts to ensure food integrity, including improving regional food systems and making grocery store jobs more sustainable.
Kroger clearly has the resources to do better. It can become a more responsible employer by investing in its employees and its communities.
- Increase the minimum pay for Kroger workers to $45,760 a year through labor negotiations or action by state and local governments.
- Provide immediate housing assistance for Kroger employees who are experiencing homelessness or face the threat of eviction.
- Double the share of Kroger workers who have full-time jobs from 30 percent to 60 percent.
- Provide a 50 percent discount on all groceries for Kroger workers to end their food insecurity.
- Provide childcare subsidies for Kroger employees’ who have children younger than 12 years of age.
- Provide at least one weeks’ notice of schedule changes for part-time Kroger workers. If this advance notice is not given, provide overtime pay for the hours worked on short notice.
- Add two positions to Kroger’s Board of Directors for Kroger’s unionized employees, elected by workers. In addition, create regional worker representative committees, with members selected by the unions that represent the largest share of front-line Kroger employees. These committees will collect data from represented workers, anecdotally and through an annual survey that is reported to Kroger’s Board of Directors and at the annual shareholder meeting.
- Amend guidelines for the SNAP program (food stamps) to require a living wage for grocery workers at stores that accept SNAP benefits.
- Provide public support for food cooperatives that pay living wages in neighborhoods that are under-served by grocery chains and require Kroger to contribute financial assistance to these co-ops as a condition of getting tax breaks, zoning approvals, and other forms of government subsidies and relief.
- Promote food policy councils as “big tent” venues for addressing food integrity issues and unifying food diverse regional constituents, including social justice advocates and organized labor, food and nutrition advocates, public agencies, large institutions (such as school districts and hospitals), and environmental advocates.
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