Living wages are minimum wages on steroids. City officials in Chicago have proposed an ordinance requiring stores of 90,000 square feet and larger and gross annual sales of $1 billion or more to pay their employees a living wage:
She's on the front lines of a fight to make Chicago the first major city to require retailers like Sam's Club owner Wal-Mart to pay a "living wage" of at least $10 per hour with $3 in benefits by 2010. For her, the struggle comes down to a simple equation: All workers are threatened unless communities hold big corporations accountable for paying better-than-poverty-level wages.
Big Labor is in the middle of the fight of this ordinance targeted at non-union retailers like Target and Wal Mart. Are union leaders getting involved for solidarity reasons? No. Union leaders are in business to serve their customers: union members. Their tactics include attempts to make potential competitors less attractive to customers.
The votes were a wake-up call. When Wal-Mart's West Side store opens, some entry-level workers will earn $7.25 per hour, or about $1 less than entry-level wages for Jewel and Dominick's workers represented by UFCW Local 881 in Chicago.
In terms of what it targets, this ordinance is similar to a Maryland law requiring large employers to contribute a proportion of their payroll to employee health care costs, a law recently overturned by a district judge. The proposed Chicago ordinace, essentially, punishes success.
Here, here, here, and here are a few formal discussions on the effect of minimum wages on employment and long-term choices made by minimum-wage workers. Here and here are two papers on the effects of living wages.