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Monday, January 20, 2020

Hike in minimum wage would reduce number of jobs, analyst says

State Government

By Karen Kidd | Dec 6, 2018

Now Illinois Governor-elect J.B. Pritzker, taken during his time on the campaign trail when he pushed for a $15 minimum wage in the state. | Twitter

With Illinois Gov.-elect J.B. Pritzker setting a deadline to raise the state's minimum wage to $15 an hour, a data analyst for a research foundation warns such an increase would be bad for the state.

"In our view, an increase in the state minimum wage to $15 per hour would be detrimental to the Illinois economy," NFIB Research Foundation Senior Data Analyst Michael J. Chow said during a Prairie State Wire email interview. "We performed an analysis of the impact of HB 198 in 2017 that would have increased the state minimum wage to this level over a period of five years, 2018 to 2022, while also increasing the cash wage for tipped employees."

The gain in dollars in employees' pockets would drop the number of employees in the state, Chow said.

"Our analysis of this bill concluded that over 93,000 Illinois jobs would be lost by the end of a 10-year window," he said. "We forecast that nearly 56 percent of the jobs lost are jobs that would have been in the small business sector."

In August, Illinois's outgoing Gov. Bruce Rauner, a Republican, vetoed HB 198, which would have raised the state's current minimum wage of $8.25 per hour, where it's been since 2010, steadily until it reached $15 per hour by 2022.

Pritzker doesn't take office until next month, but he seems to be moving ahead with plans to raise the minimum wage in the state. Earlier this week, Pritzker told WMAY News that a priority is raising wages and Illinoisans' standard of living while also looking for ways to minimize the blow a wage increase could deal to businesses. Pritzker did not specifying how he would do that during the WMAY interview, but during a press conference Monday, Pritzker set a six-month deadline to increase Illinois's minimum wage.

While Pritzker didn't say in either appearance how high the minimum wage should but he supported a $15-per-hour rate during his campaign, well more than the current state minimum wage $3 more than the wage in Chicago.

Illinois's diverse geography does a great deal to cloud the minimum wage debate, Chow said.

"I think I should also mention that consideration of differences in the cost of living between geographic regions is important in the minimum wage debate," he said. "It goes without saying that Chicago is very different from rural areas of the state."

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