DISQUS

person · 3 years ago

I can't say you're wrong. Walmart will have less new jobs, due to this minimum wage law. However, I think it is worth noting that it is difficult to live on less than $10 an hour in Chicago.

Moreover, I don't know that workers find a -$10 wage acceptable as much as they feel compelled by need to accept it.

Chad Van Schoelandt · 3 years ago

In response to person, I will point out that if the cost of living in Chicago is high, and the wages are not sufficient to keep labor in the area, then this will have the effect of encouraging people to leave Chicago, at least in marginal cases. This would reduce labor supply and possibly raise wages for those remaining.

The high minimum wage in the city may have the unfortunate effect of encouraging people to move there believing they will find good paying jobs and simply end up unemployed. Just a thought.

Louis Chartrand · 3 years ago

A few more reasons why this analysis is shallow and overlooks important stuff:
1) How does Wal-Mart to get prices that low? It tries to buy as much as possible from the same provider. Then, when it has monopolized its production and the provider has lost most of his clients to fulfill Wal-Mart's demand, Wal-Mart it forces the provider to lower its price until the provider can barely survive.
2) I don't know about Wal-Mart's locations in Chicago, but in Montreal, it's always far away from older neighborhoods, where the poor populations go. So, who goes to Wal-Mart? Well, people with cars. That seems to exclude people who have trouble feeding their families. It sure is the case where I live.
3) In Montreal, there's a place where a lot of poor people go shopping: St-Hubert street. Most people go there on foot because it's located in a poor neighborhood, but it also attracts middle-class shoppers who park in nearby streets, as it is features very good fashion stores. Prices are really low, probably close to wal-mart-low. How is it possible? Cheap labor. Immigrants who don't know french and have trouble finding jobs, children when the business is a family business, merchants who litterally live in their commerce and/or make miserable profits to make sure their commerce keeps working, etc. These poor merchants pay the price when middle-class people stop going to their stores to shop in Wal-Mart. And Wal-Mart is well known to hit hard on the competition.

person · 3 years ago

Chad,
I agree that wages below the costs of living would likely encourage people to leave Chicago. But I don't know if that is a good thing or bad thing. First many of people that might be encouraged to leave have family in Chicago. For poor people, extended families have economic as well as sentimental importance. For example, a women may depend on her mother for free childcare. Second, poor people often lack their own transportation, as Louis notes. Some poor people may depend on public transportation. Rural areas do not usually have such dependable and affordable public transportation. Finally, areas outside of Chicago may not have even less employment opportunities.

Jen · 3 years ago

More than ten years ago, I worked at a branch office in Iowa for a company headquartered in Chicago. The starting pay was $7 an hour for phone reps in Iowa, but the exact same job for the exact same company in the Chicago office paid $12 an hour because they couldn't get people to work for less than that due to the high cost of living. So I guess my question is- how many jobs is this really going to impact if the market wage was that much higher ten years ago? Is it largely a moot point? Does anyone have data on how many jobs it will impact?

Retief · 3 years ago

Data? Data? Will doesn't need any stinkin' data. He's got dogma and he's got a healthy dose of snide.

homesteading · 11 months ago

at a time like this, people should be thankful if they have jobs. getting by is hard with the economy and all.