By Benjamin Yount | Illinois Watchdog
Illinois is one of the best paying states in the country, but the economic reality in the Land of Lincoln proves why a higher minimum wage does not make things better for low wage workers.
Illinois’ $8.25 an hour is the fourth highest minimum wage in the country. Only Washington, Oregon and Vermont pay more.
But Illinois has the second highest unemployment rate in the country. Only Nevada is worse.
Illinois’ 9.2 percent jobless rate dwarfs the national rate — 7.2 percent.
“While we can’t place all the blame of our state’s woes on the minimum wage, it clearly is a factor and one of the reasons Illinois continues to seriously lag behind our neighbors,” Kim Clark Maisch, Illinois’ director for the National Federation of Independent Business, said.
In other words, someone working a minimum wage job in Iowa earns a dollar less, but because Iowa has half the unemployment — 4.8 percent — there more jobs to be had.
If nearly one in 10 people not having a job wasn’t bad enough, Maisch said the figures are far worse for the people who usually work minimum wage jobs.
“In fact, teen unemployment (16-19 year olds) is around 26.5 percent in Illinois and 48 percent in the city of Chicago,” Maisch said.
That means half the young people in Illinois’ largest city cannot find a job. No minimum wage, no matter how high, is helping them.
And don’t kid yourself, young people are the ones doing most of the work for minimum wage.
As a 2012 Bureau of Labor Statistics report notes “Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up about half of those paid the federal minimum wage.”
Maisch said most minimum-wage workers are only part time, few are the heads of households, and less than 5 percent are adults who work full time.
But even full time at minimum wage does not make someone poor.
The federal government’s poverty threshold defines a single person making less $11,490 as poor. Working 40 hours a week, someone making Illinois’ $8.25 an hour would earn $17,160 a year.
The feds say a family of four is poor if they earn less than $23,550. If both parents work minimum wage jobs in Illinois, they’d bring home $34,320.
That family of four would earn more than $40,000 a year if Illinois Gov. Pat Quinn has his way.
Quinn has been pushing to raise Illinois’ minimum wage to $10 an hour.
Maisch said if Illinois can’t find jobs for its citizens while paying $8.25, what will the state look like at $10 an hour.
“If government would stop intervening by setting artificial wage rates, mandating expensive and burdensome regulations like Obamacare, and stop throwing roadblocks up to starting small businesses our state and our country would be much better off,” Maisch said. “ When I ask my members – small business owners – what do you need to help you succeed in your business they say “tell government to get out of the way.”
Contact Benjamin Yount at [email protected] or find him on Twitter @BenYount.