Skip to comments.Target threatens to leave city (Chicago) if 'big-box' wage rule passes
Posted on 07/14/2006 4:02:49 AM PDT by Chi-townChief
Target is putting plans to build three South Side stores "on hold" -- and making veiled threats to close existing Chicago stores -- if the City Council mandates wage and benefit standards for "big-box" retailers, African-American aldermen warned Thursday.
The saber-rattling is intensifying as the clock winds down toward a July 26 showdown vote on plans to make Chicago the nation's first major city to establish a "living wage" for stores with at least 90,000 square feet of space operated by retailers with $1 billion in sales.
Minneapolis-based Target becomes the second retailing giant to threaten to pull out of the lucrative Chicago market in a last-ditch effort to stop an ordinance championed by organized labor that breezed through the City Council's Finance Committee 15-6 and has attracted support from 33 aldermen.
The current federal minimum wage is $5.15 an hour. Illinois' minimum wage is $6.50
Most Chicago area Wal-Mart employees average $10.99 an hour, with just a few making the starting wage of $7.25 an hour, Wal-Mart spokesman John Bisio recently said.
As of 2004, Target in many cities had a starting salary of about $7 an hour, published reports said. A few Target workers outside Illinois said they recently started with salaries as low as $6.25 an hour, according to postings on the Target Union! (www.targetunion.org) Web site for store employees.
Wal-Mart has threatened to cancel plans to build as many as 20 Chicago stores over the next five years if retailers are required to pay employees at least $10 an hour and $3 in benefits by July 1, 2010.
'It would be devastation for us'
Mayor Daley is taking the threat seriously. He has challenged aldermen who oppose Wal-Mart's 20-store expansion to describe how they would replace the 8,000 lost jobs.
Target failed to return calls on the admonition communicated to aldermen of the 5th, 9th and 34th wards in recent days. Target real estate executive Chris Case was scheduled to meet with African-American aldermen Thursday, but the meeting was canceled because of scheduling conflicts.
Ald. Carrie Austin (34th) said a Target pullout would be devastating to the 32-acre shopping mall at 119th and Marshfield that developers had hoped to build, with help from a $23 million city subsidy. Home Depot would likely follow Target out the door. As many as 1,000 jobs would be lost, Austin said.
"It would be devastation for us. Our largest employer in the 34th Ward is the Police Department. The second-largest for us would be Jewel. We have no other resources," Austin said.
Referring to the anti-Wal-Mart movement that gave birth to the big-box ordinance, Austin said, "If you want to bully up on Wal-Mart, you've got to bring in the other ones, and damned if you do on them. If they suffer from it, too bad. If you want to control Wal-Mart, you should go about that a different way."
Accused of 'bullying tactics'
Ald. Leslie Hairston (5th) said she has a letter of intent from Target to build a new store at Marquette and Stony Island in her ward. But the developer has told her the store is "on hold" and that Target may close existing Chicago stores if the big-box ordinance goes through.
Hairston called it little more than a scare tactic. And even if the threat turns out to be real, she's standing firm in support of organized labor.
"Wal-Mart and Target could pay their people a living wage. Then we wouldn't have this problem, and people could actually live on the money they made," Hairston said.
Ald. Joe Moore (49th), chief sponsor of the big-box ordinance, accused Target and Wal-Mart of using "bullying tactics" to stop a train that has already left the station.
"It's an idle threat. ... They're clearly trying to ... intimidate members of the City Council. I am very hopeful that members will hold firm. ... The votes are still there," Moore said. He predicted 33 votes for the ordinance, "maybe more," even though Daley has been buttonholing aldermen to try to stop it.
Ald. Howard Brookins (21st) is still searching for a big-box retailer to replace the Wal-Mart his colleagues nixed at 83rd and Stewart.
Brookins said Wal-Mart executives have told him they may take the lead of the riverboat casinos that ring Chicago and run free shuttle buses to their suburban stores if the big-box ordinance passes.
"I don't know if it was in jest, but they did say it. ... That is an option that they could employ. They could set up locations to have pickup and dropoff. I don't think that is that farfetched," Brookins said.
For once I'm proud of something "French", showing some brass ones.
Maybe the spread of HIV/AIDS after the Gay Games will occupy the time of the alderman who don't like guns, cigarettes, trans fats, or foie gras.
I hope Target and all the big boxes come out to Will County (heavy Republican) where growth is spectacular.
The minimum wage is going to be at $7.25 everywhere in short order anyway. I don't think they are actually going to leave. They'll threaten. But there is no where to run.
It really doesn't make sense to leave even if the minimum does not go up everywhere else. You just raise your prices to cover it, and you give that as your reason.
"Ald. Joe Moore (49th), chief sponsor of the big-box ordinance, accused Target and Wal-Mart of using "bullying tactics" to stop a train that has already left the station."
Gotta love the way the libs insist that they have the right to demand that Target and Walmart build in their area, all the while giving up any rights to make their own decisions in regards to running the store. As far as I can see, if a person doesn't want to work for $8 an hour, they simply don't apply for the job. Raising the wages would only result in higher product cost - that way everyone gets to move backward.
Target is not French-owned. That's an urban legend.
Maybe they should open another Bix Box Police Department.
The city is lucky that ANY business wants to open in this district.
WOW - 'good' Target is going the same route as bad old WalMart. This should piss off a few lefties.
And a few Freepers.
But the city is also demanding another $3 in benefits for every employee.
Plus, these stores will have higher insurance, higher rates of theft and vandalism, and higher employee turnover.
Something will have to give. There's not that big of a margin.
"But there is no where to run."
Will and Kendall counties are waiting...
So build 89,999 SF stores with the design ability to shed SF, based on changing standards....
True, the French do not own Target.
Well, geez, Ms. Hairston, you seem to know so much about how to run a Walmart or Target store, why don't you just step in and take over as CEO?
Typical liberal the state should run everything mindset.
Wow! I never knew that. The French story is just so pervasive. I looked at Target's "About Us" and just read that they are the old Dayton-Hudson and Marshall Fields.
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