Large retailers are very concerned about proposed legislation sitting on the Washington, D.C. mayor’s desk.
The legislation, passed by the D.C. Council, proposes a higher minimum wage for workers employed in D.C. by large retailers like Target, Walmart, Home Depot, Walgreens, and others. (Full disclosure: My agency works for Walmart, but not in the Washington, D.C. market.) Not surprisingly, large retailers are opposed to the legislation, which according to its supporters is aimed at providing a minimum wage that’s more in line with what is a living wage for the city.
If passed, the new minimum wage for retailers with more than $1 billion in sales operating stores 75,000-square-feet or larger would be $12.50 an hour, which is $4.25 more than D.C.’s regular minimum wage of $8.25.
Innovative or punitive?
By targeting large retailers, D.C. Council politicians in support of the law proffer that residents with less education and lower job skills in poor neighborhoods with high unemployment make up a large percentage of the people who apply for minimum-wage positions at large retailers—yet under the current minimum wage, they aren't able to make a living wage to support themselves or their families. Large retailers, on the other hand, are calling the law discriminatory and saying that it will ultimately punish potential employees in the area if stores don’t expand because of the mandated wage increase.
Some argue that the law will hurt the people it’s aimed at helping by providing a disincentive for large retail expansion, while others say that the difference between the current minimum wage and proposed living wage will make a huge difference for people who need it the most.
Playing devil’s advocate, there’s some irony in the fact that many of the residents that the proposed law are supposed to help are products of a school and social system under the direction of the D.C. Council. So are politicians asking large retail to pay in part for the failures of a system they created and direct? Is the real issue minimum wage or education and training? Maybe it’s not either/or, but both?
The problem is one that plagues all innovation efforts—making sure you’re asking the right question to begin with. Is the D.C. Council asking the right question and coming up with the best solution after exploring a number of alternatives? Maybe the question should be, “How can we help solve the lack of stores and high unemployment problem in our area and have people earn a living wage?” Mandating higher wages is one idea—but it’s just one of what could be many (and perhaps more innovative) solutions.