Beep.... Illinois minimum wage flatlines

By Megan Cottrell
Chicago Reporter, June 30, 2011

For the first time in five years, the state minimum wage won't go up today. From 2006 until 2009, the lowest wage that employers can pay their employees went from $6.50 to $8.25. And low-wage workers won't see their paychecks increase unless the Senate moves on a bill, SB 1565, that's currently stalled in committee.

Not only is the minimum wage not increasing in actual dollars, but its value has eroded too. According to Raise Illinois, a coalition of state organizations that are advocating to increase the minimum wage, in terms of what you can buy with it, the minimum wage reached its peak in 1968. If it had kept up with inflation, it would mean our state's poorest workers would be making more than $10 an hour.

Advocates at Raise Illinois say $16,500 a year--the approximate amount that an Illinois minimum-wage worker takes home in a year--just isn't enough to live on. Listen to Annette Jones, a health care worker who started off making $3.35 in the mid-1980s--the minimum wage at that time:
[See original for video]

The main argument against raising the minimum wage is usually that it forces businesses to cut jobs. But at today's press conference, two business people stood up to defend an increase in the minimum wage, saying it benefits them when their workers make enough to live on.

Here, Bill Flynn, CEO of Paeon Partners, talks about why he encourages the employers he works with to pay their employees a living wage:
[See original for video] 

Pam Fox, owner of Fox Hair, said everyone loses when heads of households are working two and three jobs to make ends meet, unable to care for their families or be invested in their community.

"I really think it's un-American to pay people a wage they can't live on," Fox said.

The group cited a study out of the November 2010 issue of the Review of Economics and Statistics (PDF), which showed that higher minimum-wage rates didn't reduce employment. The study's authors said previous studies that showed that minimum-wage increases hurting employment were flawed because they failed to take into account economic changes in a region--like slower-than-expected economic growth. So declines in job growth were wrongly attributed to the rise in the minimum wage, even though the real cause of job stagnation was outside economic factors. Many of the advocates who spoke at today's press conference, including Fox, said she thought raising wages helped her business because her own employees could afford to come back and spend some of their money where they worked.

What do you think? Is Illinois' minimum wage high enough, seeing that we're already above the federal minimum wage and higher than many other states'? Or should a minimum wage always be enough to get by as a full-time worker in the U.S.? Leave us a comment and tell us what you think.

 

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