Labor Day

I don't have the time to write a detailed post doing this topic justice, but here are some issues to think about.  Also see "At last, workers are pushing back" and "If Labor Dies, What's Next?" by Harold Myerson.

-- Wage inequality, and the impact of inequality on a consumption-based economy.

- US Economics: Inequality and Consumption, Morgan Stanley

-- Various minimum wage initiatives at the city and county level across the country.

- Campaigns | Raise The Minimum Wage

-- The state of labor unions as a potential check on inequality, power, relationships to progressive urban policy agendas, and the negative impact at times of police unions on crime and public safety policy.

-- For cities and states, the pension and health insurance cost "crisis."

- The pension crisis in Chicago and Illinois, Chicago Tribune

-- The "Gig" or "independent-contractor"/consultant based economy and how this puts more responsibility for risk onto the individual.

- Risk Shift and the Gig Economy, Economic Policy Institute

-- The New York Times published a piece on Friday about labor-related art. "Take a Labor Day Tour of Blue-Collar Art" in the New York region and earlier in the summer, about labor-related poster art in an exhibit at the New-York Historical Society, in "Seeing the Power of Political Posters."

New Year's post #2: chain stores, local employment and responsiveness

1.  There's a lot of writing by conservatives about minimum wage laws and how raises are so pernicious to the free market and limit employment at low level jobs, along with a lot of waxing poetic about the value of work and these kinds of jobs as entry level positions.

I don't think that these conservatives (e.g., this piece by Ben Carson, "Getting to the top by starting at the bottom," Washington Times) recognize that as independent businesses, especially at the retail level, have been overtaken by chain companies, either owned and operated stores (like a Safeway or CVS) or a franchised operation (like most fast food restaurants), the opportunities for people under the age of 18 to get a job is significantly eliminated, mostly because of insurance, risk management and other rules.

From the article:

I vividly remember as a teenager obtaining my first job with a regular paycheck as a high school biology-laboratory assistant.  It’s hard to describe how excited I was to be receiving a salary and contributing to the upkeep of my family’s household, but the biggest thrill was doing something important while at the same time acquiring many skills that would prove useful in the future.

Similarly the decline of newspapers limits the opportunity for kids to "deliver" the local newspaper and learn about work that way.

Hey I delivered the Detroit Free Press as a kid, and at 9 yeas old when I lived in South Lyon, Michigan I did odd jobs for the pharmacy and the supermarket across the street (I lived in the commercial district).  I got my first payroll job at 16, at a local Big Boy--my friend, who worked there got a job because of his sister, and he got a job for me.

I understand the sentiment.  But it's nostalgia for a work environment that doesn't exist any more.

b.  Note though that's why I suggest that urban high schools develop cooperative education programs that incorporate workforce learning within the curriculum, to deal with the risk management issues and provide opportunities for employment-related learning and income.

2.  Similarly, chain stores aren't great for responsiveness to local customers.  More than 2 years ago but less than 3 years ago, Giant Supermarkets here went through what is called SKU rationalization, where they dropped items that sold less, focusing their stock on items that sell more, and "forcing" people to buy what they have, in order to be able to buy more of particular items at lower prices, passing those savings to the consumer in terms of lower prices.

But as some companies found out (like Walmart), SKU rationalization cost them customers because people shopped at other stores to get the products they wanted.  

That happened with me at Giant, because instead of carrying the 5 flavors of Edy's Frozen Yogurt that I like, they started carrying only two, neither of which was my favorite.  This ended up costing them 6-8 of my annual shopping trips per year, because when I wanted the other flavors of frozen yogurt I know to go to Safeway.

BUT... Safeway didn't carry my favorite flavor, Cappuccino Chocolate Chip.  So I wrote to Edy's and Safeway suggesting that Safeway also carry this flavor.  I did that between 2 and 3 years ago too.  Just last week I saw that Safeway has started carrying it.  Change takes a long time...

b.  Speaking of Safeway, they do have variations between stores on stocking even their store brand items.  I thought they stopped selling Safeway Select Chipotle Salsa and Safeway Select Raspberry Jam (both particularly decent products for own brand).  Nope.  Just my store.  It sucks to have to shop multiple Safeways though to get the items you want.

The Living Wage Bill and the 2014 DC elections

It's been reported locally and nationally--especially in the business press---that Mayor Gray vetoed the Large Retailer Accountability Act legislation.  The major provision in the bill was to impose a "minimum wage (including benefits) of $12.50 per hour on stores that have at least $1 billion of sales in the US, and are 75,000 s.f. or larger.

This was seen as a bill specifically directed at Walmart, because the bill has an exclusion for unionized employees, which would end up exempting chain supermarkets like Safeway or Giant.

I wasn't in favor of the bill, not because I think that retailers should be able to pay their employees poorly, but because I think that DC needs to have a much better set of regulations in place for the land use review of big box store projects, to ensure that the projects are well integrated into the urban fabric and to mitigate possible negative effects.  See "Lessons from Walmart's foray," "Walmart: in the city, vs. of the city" and "DC's proposed legislation on large retailers is misguided."

But that wasn't the bill that the Council passed.

I probably am in support of the bill, as a recognition that minimum wages should be higher, and that with the hollowing out of the middle ground in available jobs, "Walmart" or "McDonald's" jobs (fast food workers have been "striking"--they don't have unions--for better pay over the summer, see "Fast-food workers strike for higher pay" from USA Today) are no longer entry jobs, a rung in the ladder of "moving on up" job-wise, they are permanent, especially for less well educated employees.

Just as cities and corporations are going bankrupt because of material changes in how local economies work as a result of the US being connected within a global economy, the world of work is in the process of changing as well.

Living Wage bills are on the agenda of more and more cities.  It's an issue in the Seattle election right now as well ("Seattle mayor wants to block Whole Foods because of its low wages" from Grist Magazine and "Can city stop Whole Foods over pay? Lawyers differ" from KOMO News) and it's even on the ballot in the Puget Sound community of SeaTac ("Appeals court says SeaTac voters can decide on $15 minimum wage" from the Seattle Times).

When travelling abroad, compared to the US, I am always struck by how much more expensive food costs in supermarkets and at restaurants.

It's because employees are paid a living wage (+ taxes are higher on businesses, which pays for national health programs).  In the US, our low food prices come at the expense of labor.

Going forward that may be changing.

The impact on the DC elections.  Mayor Gray will make the case that he vetoed the bill to prevent Walmart from leaving the city, and two of the stores that they propose to build are in lesser served areas of the city (plans for a sixth store fell through more recently, see "For what it's worth"), and they will be large employers.

Call out quote from the Black Commentator article "Cover Story: A 'Movement' Against Wal-Mart."
 
I have written before that Walmart, typically, treats employees pretty badly ("Piling on City Council") and so it is an issue of "is any job better than nothing?"

As a city, as a community, we should be concerned about the businesses we attract and actively recruit to the city and in turn, the kind of environment and opportunities that these businesses provide to their employees.

Regardless, I think this will be a big election issue in the Mayoral campaign.  I think Gray's veto means that he has already decided that he won't run for re-election.

But, I could be wrong.  Maybe he will run again.  But it's going to be hard for him to not be implicated in election fraud around his successful primary win in 2010.  So maybe that is an influence too.

And he thinks that Walmart is the right choice to define his Mayoralty, for his legacy.