Washington Push for Higher Minimum Wage for Workers Has Walmart Balking

Mayor Vincent C. Gray, who worked hard to lure Walmart, finds himself caught in the middle, and many residents sound less than grateful to lawmakers.

“Those big people in government, they don’t understand my situation,” said Fred Reaves, 45, who is unemployed and said he would gladly take a job at the current city minimum, $8.25.

“Eight-something, it’ll motivate you to start going to work,” Mr. Reaves said as he stood around the Skyland Town Center, a patch of barren asphalt and shuttered stores where Walmart planned to build. “You can start paying some bills. It will help you to come off public assistance.”

On July 10, the City Council passed a “living wage” measure that would require Walmart to pay at least $12.50 an hour, saying it was fighting to protect struggling residents in what has become a high-cost city.

Supporters of the measure say that Walmart, whose revenues in 2012 were $469 billion, can well afford to pay workers more.

“Their net income was $17 billion,” said Vincent Orange, a city councilman who voted for the ordinance. “You don’t want to share a little bit with the citizens? Come on.”

A decade ago, the city gave tax breaks to lure retailers, Mr. Orange said, but now it is booming and can negotiate from strength.

The day before the City Council passed the measure, a Walmart official warned in an op-ed article in The Washington Post that if required to pay $12.50 an hour, the company would cancel three planned stores and consider withdrawing from three projects already under construction.

The next move is up to Mayor Gray, who is weighing a veto.

Officially the mayor has taken no position, but he is widely seen as opposed to the measure. The Council has delayed formally sending it to his desk for action. The measure, called the Large Retailer Accountability Act, would require stores of at least 75,000 square feet that are owned by companies with $1 billion or more in annual revenue to pay the higher minimum wage. Because existing stores and those with unions are exempt, it is seen as squarely aimed at Walmart.

As Walmart, the world’s largest retailer, has sought inroads in major cities, it has faced resistance from local merchants, who fear being undercut, and from officials who say minimum-wage jobs mire workers in poverty.

Democrats on the House of Representatives work force committee produced a report this spring contending that the government subsidizes Walmart because employees earn so little that they qualify for Medicaid, food stamps and housing assistance.

Pedro Ribeiro, a spokesman for Mayor Gray, argued the opposite: minimum-wage jobs help the chronically unemployed take a first step into the work force.

“Yes, Walmart jobs are not great,” Mr. Ribeiro said. “But for some people, it will be their first employment and they’re not qualified to do anything else. We need that entry-level benchmark in the District.”

Washington is experiencing an economic revival, with population growth on a par with Sun Belt cities. But the benefits are not spread evenly. East of the Anacostia River in Ward 7, where two of the Walmart stores, including the Skyland site, are planned, unemployment is 13.9 percent. In nearby Ward 8, it is 20 percent.

Victor L. Hoskins, the deputy mayor for development, said Walmart’s threat to cancel projects if the measure took effect was no bluff. He calculated that 4,000 retail and construction jobs were at stake from three of the projects.

“The question is not $8.25 versus $12.50,” Mr. Hoskins said. “The question is $8.25 versus zero. It’s called no jobs.”

Opposite the Skyland site, on Good Hope Road, Carl Williams, 49, a barber at the Like That salon, whose dozen barbers were bustling on Thursday afternoon, had mixed feelings. He thought $12.50 was a fair starting wage. But he said he would not hesitate to encourage his two daughters to take a job at Walmart for $8.25.

“One who is 21 needs a job real bad,” he said. “She had a baby real young and didn’t finish high school.”

At a nearby Shoe City, the assistant manager acknowledged that Walmart might undercut her prices. But the giant retailer would also increase foot traffic in the neighborhood, which could benefit Shoe City, the manager, Shasherri Hindman, said.

Ms. Hindman, 25, said she started at minimum wage five years ago and worked her way up. “What’s wrong with $8.25?” she said. “I’m totally on Walmart’s side.”

Willie Ford, 39, a carpenter, scoffed at the notion that Walmart could not afford to pay $12.50. “Come on, they’re going to make beaucoup money from this area,” he said. At the same time, he acknowledged that many people in the neighborhood would gladly take a job at $8.25. “Like a newborn baby, you’ve got to crawl before you walk,” he said.