On Thursday, The Washington Post reported that Kroger, the nation’s largest grocery chain, has elected to close two stores in Long Beach, California, after the local city council passed an ordinance requiring a temporary $4 pandemic raise for grocery workers. Kroger, which doubled its profits in 2019, targeted these stores to send a message that the company will not be coerced into paying its workers a fair wage during the pandemic—or ever. It’s a threat. It also might work.
The move to close the Ralphs and Food 4 Less stores in Long Beach was branded, by both Kroger and the state’s grocers association—which represents the interests of grocery chain companies, not workers—as a business decision. It isn’t. This is a political play. As other city councils, like those in Oakland and Los Angeles, have moved to enact similar wage-increase ordinances for frontline workers, businesses such as Kroger have threatened this kind of action. (The grocers association previously sued the Long Beach, Oakland, and Montebello city governments over the ordinance.) But it’s not because the grocery chains don’t have the money to fund the pay bumps; it’s because doing so would represent a long-term threat to America’s tried-and-true business model: underpaying and overworking employees.
Closing the stores amid public outrage gives Kroger and other companies the chance to whine loudly about labor regulations in the press, while quietly padding their already stuffed coffers. Remember, we’re talking about a grocery chain operating over 2,000 stores. Shuttering two stores and putting roughly 200 people out of work in one of the most volatile economies in modern times to make a point to other cities considering wage ordinances is probably worth the risk in its eyes. Kroger has courted outrageously bad press before: In March, the company rolled out a $2 pay increase for its workers, only to roll it back come the first week of May. Outrage from union leaders resulted in the company announcing a onetime “thank you” payment—marking the final time the company a