The speaker for the School of Public Policy's seminar series will be Justin Wiltshire, assistant professor of economics at the University of Victoria. Prof. Wiltshire is an applied microeconomist focusing on labor and urban economics. He will be presenting "Monopsony Power and the U.S. Social Safety Net." Wiltshire's abstract is below:

I examine how the growth of the largest private-sector employer in the U.S. impacted the cost of the social safety net. Between 1990 and 2005 Walmart opened more than 1,900 Supercenter stores and grew its low-wage workforce by over one million new employees constituting 4% of total U.S. employment growth. At the same time, annual U.S. government transfers to individuals nearly doubled in real terms. In other work I show that Supercenter entry modestly increased local retail employment but caused significant reductions in overall local employment and earnings--particularly in goods-producing sectors. In this paper I build on those results, demonstrating that Supercenter entry increased local unemployment, leading to sharp local increases in federal Earned Income Tax Credit (EITC) receipts totalling $12 billion (2024 USD) without inducing greater labor force participation. The pattern of results suggests Supercenters exercised monopsony power in the labor markets they entered, negatively shocking the local economies and reducing some family incomes below EITC income-eligibility thresholds such that they qualified for an EITC. EITC eligibility may also have incentivized some workers who lost their jobs following Supercenter entry to accept lower-wage jobs if the EITC partially topped them up, perversely increasing labor supplied at lower wages and allowing Walmart to capture some of the incidence of the EITC.