This week in Chicago, the city council is passed a new ordinance that would require “Big-Box” retailers (90,000 sq ft, and 1 billion in gross sales) in Chicago to pay $10/hour with $3 in benefits by 2010, after that it increases with inflation. This law is targeting Wal-Mart, but will also apply to Target, Home Depot, and others. Before the ordinance passed Wal-Mart said it would not build stores in Chicago if it passed. Target claimed it would close store in the city.
Several people are calling this a living wage law. I don’t believe it is, it is just an anti-Wal-Mart law. If you wanted to pass a living wage law, then make the minimum wage $10/hour for everyone. Not just “Box-Box” retailers. All you will do by passing this ordinance is making headlines, possibly get reelected, and discourage the building of 90,000 sq ft stores. If reports of Wal-Mart’s penny pinching are to be believed, Wal-Mart would still build stores in Chicago, Wal-Mart would just hire fewer people to run the stores.
If this ordinance remains on the books, it will be interesting to see the economic impacts on the communities in and around Chicago.