A California city proudly passed a law forcing grocery stores to raise their wages by $4. Unsurprisingly, grocery stores began going out of business all across the city.
The city government of Long Beach were thrilled to pass and sign into law a requirement that forced local grocers to raise their wages. The new law forces the mandate on companies that employ more than 300 employees nationwide or at least 15 in Long Bach.
Taking a moment in-between watching inaugural events to sign a $4 an hour pay increase for grocery and supermarket workers. You have earned this hero pay. Thank you for your hard work. pic.twitter.com/sZhbsukYME
— Robert Garcia (@RobertGarcia) January 20, 2021
To reiterate, the city is forcing the companies to raise their wages. The city is not subsidizing the wage hike. It is forcing the businesses to dish out the massive all-at-once pay hike.
The result of the new city ordinance could be seen a mile off: grocery stores began closing down because the businesses could not afford the sudden pay hike.
KABC-TV reported that the California Grocers Association filed a lawsuit to try and stop the forced wage hike.
Kroger and others announced it was shutting down several outlets in the city. On Monday, Kroger announced the closure of two stores in the city, Ralphs and Food 4 Less, on April 17, citing the ordinance.
“As a result of the City of Long Beach’s decision to pass an ordinance mandating Extra Pay for grocery workers, we have made the difficult decision to permanently close long-struggling store locations in Long Beach,” a Kroger spokesperson said in a news release. “This misguided action by the Long Beach City Council oversteps the traditional bargaining process and applies to some, but not all, grocery workers in the city.”
Kroger had already given their employees a raise recently, though not as much as $4 an hour.
Naturally, the detractors say that Kroger is “greedy” and that is why they are closing their stores. The claim, of course, does not stand up to scrutiny. Why shut down their whole operations to save a few dollars an hour? That makes no sense. The truth is, the operations can’t survive the pay hikes. That is why they are closing.
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