This is an article from Time magazine about Target's decision to scrap plans to build new stores in Chicago.
It discusses Target's Jobs and Opportunity Zone Initiative, a campaign to open 50 stores in bad neighborhoods.
It brings up a group of keyplayers not previously mentioned, and that is the shareholders for large-scale retailers. The big stores have to satisfy these people by growing and expanding, and they need to move into new areas to accomplish that. They are probably thinking, though, that this growth will not occur if they enter big cities while increasing their wages at the same time. It seems like they need an economist to come in and punch out some numbers for them--if they increased their pay, would they have to increase their prices equally in order to see growth? Or could they leave prices and increase pay and still see some growth? It is impossible to predict the future, but Chicago would not be the first city to do this. They could look to San Francisco and see that it has not been a problem.
If the urban market is rumored to be so lucrative, it seems like they could bring stores there, increase wages by a small amount, and still turn a profit and please their shareholders. I wonder what the shareholders opinions are on the minimum wage topic--on the one hand, they would be against it because it decreases their profit, but on the other hand, it is becoming quite a moral dispute.
Where the battle stands right now is phrased perfectly in the closing of the article--Wal-Mart and Target's threats to stay in the suburbs for now while Mayor Daley makes his decision is just an economic game of chicken. Hopefully he will see that he has enough power to make a different decision than what money would dictate here.
