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Question of the day

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Illinois

* From a press release…

Chicago, IL – Billionaire gubernatorial candidate Bruce Rauner is opposed to raising the minimum wage “depending on what day you ask him about it,” wrote Gapers Block this morning. Despite Rauner’s clear advocacy for lowering or outright eliminating the minimum wage, Rauner has falsely denied such a position and said he was misunderstood.

On Friday, after having months to reflect on his minimum wage position, Rauner made it clear that he remains strongly opposed to raising the minimum wage. Below is an excerpt of Rauner’s interview with the State Journal Register Editorial Board:

SJR: “You’ve said you were ‘adamantly adamantly’ against raising the minimum wage. You’ve said it here many times.”

Rauner: “Yes. Yes. Exactly because Illinois is not competitive. One of the reasons we have a higher unemployment rate than the states around us is because we have a higher minimum wage than the states around us.”

“Rauner has once again shown his true colors. If he gets his way, he’ll slash taxes for big corporations, defund education, and lower the state’s minimum wage,” said Neal Waltmire, Communications Director for Illinois Freedom PAC. “Rauner’s Wall Street agenda has been tried before and it led to the greatest economic crisis since the Great Depression. Make no mistake, Rauner’s heart is with Wall Street, not the hard-working families of Illinois.”

* Paul Vallas said today that Rauner “doesn’t get it”…

“Bruce Rauner opposes the minimum wage because it cuts into profits,” Vallas said at a news conference outside the state Capitol. “He said a higher minimum wage is bad for the economy. How absurd.”

Vallas said 13 states that raised their minimum wage have seen better economic performance than the country as a whole.

…Adding… More of what Rauner said…

I want an answer, how do we grow, who do we increase our competitiveness? I’ve got the answers, and they’re two darned good answers, that’s what I do, come up with answers. Increase the national minimum wage so it’s above IL. Then we don’t hurt our competitiveness which is the reason I’ve been commenting on the minimum wage. I would support that. Great, then IL companies are now competitive and we can grow our economy. And we can help our working families. Or increase IL’s minimum wage but combine it with pro growth strategy - workers comp, tort, tax, so then businesses aren’t causing more unemployment, shedding workers, and leaving the state, we’re more competitive and then we can raise the minimum wage and have it better for everybody. So there’s answers, there’s solutions, bipartisan, I can get that done. Pat Quinn’s had six years to fix the minimum wage and he hasn’t.

* The Question: Do you believe Illinois’ higher minimum wage has damaged our economic competitiveness? Take the poll and then explain your answer in comments, please.

surveys & polls

posted by Rich Miller
Monday, Oct 27, 14 @ 1:47 pm

Comments

And please stick solely to the question asked. Thanks.

Comment by Rich Miller Monday, Oct 27, 14 @ 1:48 pm
Me thinks it is a wash…

Comment by OneMan Monday, Oct 27, 14 @ 1:52 pm
If a higher minimum wage has hurt Illinois in attracting businesses that are venue shopping, it’s primarily because businesses have decided to punish states for…

a. being union friendly
b. having higher minimum wages

That is, the policies aren’t harmful. It’s how the MBAs are indoctrinated to perceive the policies.

Comment by Carl Nyberg Monday, Oct 27, 14 @ 1:56 pm
No, I think the idea is insane.

Only 2.6 percent of American workers are at minimum wage. How does rodgering them even more make you competitive?

Comment by Wordslinger Monday, Oct 27, 14 @ 1:56 pm
No. Minimum wage jobs are primarily in the service industry. You can’t outsource service jobs because they have to be where the people are (restaurants, cleaning services, etc.). Manufacturing jobs, which can be outsourced and their products shipped, are not typically minimum wage jobs.

Comment by Martin S. McFly Sr. Monday, Oct 27, 14 @ 1:59 pm
Minimum wages are spent right here. Should be raised. There re many things that go into being competitive.

Comment by reflector Monday, Oct 27, 14 @ 2:02 pm
Voted ‘no.’ I look at the per capita GDP of states with higher minimum wages and it seems pretty stable from pre- to post- change.

Whether or not they’re serving the same industries might be a different story.

Comment by Stuff Happens Monday, Oct 27, 14 @ 2:02 pm
I voted “yes”, but did so only in relation to the vast amount of Illinois geography outside of the Chicago area. In Chicago and surrounding areas, most businesses already have to exceed the minimum wage to get quality workers.
Elsewhere in the state, a higher minimum wage does create disparities in the business climate.

Comment by A guy... Monday, Oct 27, 14 @ 2:02 pm
No, I don’t believe a higher minimum wage depresses the economy any more than lower taxes stimulates job growth. Both are Republican myths.

Comment by Wensicia Monday, Oct 27, 14 @ 2:04 pm
Well, as business people know, an increase in the minimum wage, say to $10, pushes up the wage scale overall. Someone making $9.50 will not be happy at $10, they will want $11-$12/hour. It just is not an accurate evaluation to say 2.6% of the people make minimum wage so it doesn’t have hardly any impact. C’mon.

It has to do with overall costs in a business and the profit margins.

Comment by anon Monday, Oct 27, 14 @ 2:04 pm
The question calls for a yes or no answer. Point of logic; has a higher minimum wage helped competiveness? Probably not. So, it has either harmed competiveness, or it has had no affect whatsoever. Take a guess because that is all that you can do.

Comment by Keyser Soze Monday, Oct 27, 14 @ 2:05 pm
I don’t think it’s damaged anything. There’s been no evidence to the contrary. It’s a popular scapegoat, though.

Comment by Demoralized Monday, Oct 27, 14 @ 2:05 pm
Raising the minimum wage puts more money in the pockets of people who will put it right back into the economy, buying things they might not otherwise be able to afford. Profit motive might keep some businesses from setting up in IL, but with businesses like Walmart, where half the employees are on welfare, some of them do more harm than good. I think paying people a living wage will create a more robust economy. (I voted no)

Comment by my two cents Monday, Oct 27, 14 @ 2:05 pm
More money in the pockets of low-wage workers means more money in local economies and less strain on public benefits. And it pushes wages higher for other workers as well.

Rauner is full of it.

Raise the wage.

Comment by Reality Check Monday, Oct 27, 14 @ 2:06 pm
No.

If the answer is “yes,” where is the evidence?

Comment by Precinct Captain Monday, Oct 27, 14 @ 2:07 pm
Yes. Simple supply and demand economics, and the indirect increase in minority area poverty when low wage jobs are restricted. I think this issue is pretty over with. The effect is already built into the polls.

Comment by Chad Monday, Oct 27, 14 @ 2:08 pm
Minimum wage isn’t supposed to be a “living” wage as some suggest. Raising the wage will have little to no effect on Illinois economy. It would just be another one of the thousand little cuts that have led to Illinois slow and painful bleed-out.
Anyone falling for the Quinn spin on this is just a dope. The man coulda just raised it at ANY point in time over the last 6 years instead he is just using it. Sleazy IMHO. Shows no real compassion on the issue, just using it to suit his political needs.

Comment by Big Muddy Monday, Oct 27, 14 @ 2:10 pm
I voted no. All a recent article, all states that increased their minimum wages this year have seen faster job growth. Even if some states have since lagged, or the report is not as accurate as necessary, nothing leads me to believe that this is harming Illinois’ economy, relative to other states.

Illinois’ job growth thankfully has been improving as of late, surpassing Wisconsin and Florida, in a recent period.

Comment by Grandson of Man Monday, Oct 27, 14 @ 2:11 pm
I voted no, but It doesn’t matter what I “believe” or what a governor “believes”. This should be a fact-based decision. The U.S. Department of Labor states:

Myth: Increasing the minimum wage is bad for the economy.

Not true: Since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has steadily increased, even when the minimum wage has been raised.

Go read the whole thing here. They include 64 studies in their reasoning: http://www.dol.gov/minwage/mythbuster.htm

Comment by Sangamo Sam Monday, Oct 27, 14 @ 2:13 pm
unless by damage you mean the loss of a few payments on a Mercedes for a company exec. no real damage to the upper level people.

the disparity in wages between CEOs and workers is so much greater than it was in the 70s. the need to fly in a private jet, own multiple homes, ridiculously high salaries and parachute payouts, it’s bracket creep for corporate show of wealth. in other words, greed.

opposed to giving an increase to thousands of people who actually need to spend the money and whose lives could be made a little bit better.

raise the minimum wage!

Comment by Amalia Monday, Oct 27, 14 @ 2:13 pm
Chad, 77 percent of minimum wage workers are white, half of them over 25.

A Guy, what businesses are passing on Downstate Illinois because of the minimum wage?

Comment by Wordslinger Monday, Oct 27, 14 @ 2:15 pm
If a burger costs a bit more, I will still buy the burger. If the actual cost to the employer is 25 cents, I would expect to pay it. If their cost is 25 cents, and they add a dollar or two, I would stick to my diet better.

Comment by DuPage Monday, Oct 27, 14 @ 2:15 pm
No. If the minimum wage is raised, every penny of that money will make its way into the Illinois economy to stimulate the economy. Those making minimum wage have to spend every penny they earn, just to survive.

If the minimum wage is kept the same or done away with, the money saved by many large employers may not make its way into the economy. It could instead be invested in the Cayman Islands to avoid taxes - or invested in expanding operations in other countries.

Comment by Joe M Monday, Oct 27, 14 @ 2:16 pm
I voted yes, for the same reason that a tax on coal or fossil fuels will will reduce use of those products. The more something costs, the less of it people (or in this case, employers) can afford. It stifles hiring.

Comment by Buck I Monday, Oct 27, 14 @ 2:20 pm
Nope
We are less competitive because we are surrounded by states where you can marry your first cousin

Comment by circularfiringsquad Monday, Oct 27, 14 @ 2:23 pm
No.

Perhaps Rauner would like us to return to an earlier time, where there was no minimum wage, and workers were paid with ‘company coin’, that could only be spent at the company store.

Really, it’s a win-win for the State and for industry. Lower wages, and the wages that are paid stay in IL, becuase there would be no where else to spend it.

Comment by How Ironic Monday, Oct 27, 14 @ 2:23 pm
No damage.

Anyone who works full-time in this country should be able to afford decent housing, proper healthcare and still put food on the table. At $8.25, a full-time weekly wage is $330 before taxes. Can you rent a two bedroom apartment for that much?

In this country, if you’re willing to work hard, you shouldn’t have to worry about feeding your family or finding a place to live. It’s that simple.

Comment by 47th Ward Monday, Oct 27, 14 @ 2:27 pm
Pretty clear most repubs take finance, econ, business, marketing classes in school. The other side? How to get in touch with your inner self.

Comment by anon Monday, Oct 27, 14 @ 2:30 pm
People in Illinois over a certain age can also marry their first cousins.

I voted no. The adults I see in McDonalds uniforms on the bus would be able to buy their own food if they made more money instead of us paying for it through SNAP.

Comment by Cheryl44 Monday, Oct 27, 14 @ 2:36 pm
Lots of good explanations for voting no, as I did.

There’s no evidence that the extra $1/hr has much of a downward effect on employment. The kinds of jobs that pay minimum wage cannot be outsourced. Any negative effect on employment is balanced by an increase in consumer demand.

I’ll add some more: The minimum wage’s percentage of cost of doing business in Illinois versus some other state is miniscule — other costs and factors are far more important. You have to factor in productivity: if an Illinois minimum wage worker can produce $50,000 in added value at a cost of $17,160; while a worker in another state (I don’t want to pick on Alabama and Mississippi)only produces $45,000 of added value at a cost of $15,080, the smart business will happily locate in Illinois despite the higher minimum wage.

But saving the best for last: Illinois’s crappy economic recovery owes more to national macroeconomic factors than to any state policy. Yes, yes — I know the IPI and conservative arguments that we are last in the nation for economic growth. But that honestly has more to do with the structure of our economy, the sectors we actually have, our demographics than it does with our local policies. Thing is whether we raise the minimum wage or not will have very little impact until the national economy recovers.

Comment by VM Monday, Oct 27, 14 @ 2:36 pm
Brucie is a fool and a tool. He doesn’t get it because he’s never had to live it. The higher minimum wage creates economic activity, gives consumers more buying power but doesn’t help vulture capitalist who thrive on disruption in the marketplace and unequal bargaining positions.

Comment by D.P.Gumby Monday, Oct 27, 14 @ 2:40 pm
It’s hard to compete when someone else can do it cheaper. Wages are based on marginal productivity. That’s why I voted yes.

Comment by Steve Monday, Oct 27, 14 @ 2:41 pm
NO damage minimum wage workers aren’t saving the wage they are surviving with it !!

Comment by railrat Monday, Oct 27, 14 @ 2:42 pm
@ Anon 2:30 “Pretty clear most repubs take finance, econ, business, marketing classes in school. The other side? How to get in touch with your inner self.”

Should read “Pretty clear most repubs take vulture finance, voodo econ, out sourcing business and shady marketing classes in school. The other side? Reality based business decisions not based on fear or lies.”

That’s closer to the truth.

Comment by How Ironic Monday, Oct 27, 14 @ 2:43 pm
No damage.

The vast majority of people making minimum are in retail and service industries which can’t move out of state. And almost every penny paid will stay in state. Raise it to something people can actually live on.

I even wouldn’t be opposed to regional minimum wage based on prevailing local living expenses - I’ll bet living on minimum in Chicago is a heck of a lot harder than in Lacon or Pearl.

Comment by Ken_in_Aurora Monday, Oct 27, 14 @ 2:43 pm
It will help our economy as more people can buy some of the most basic things.

Comment by Belle Monday, Oct 27, 14 @ 2:45 pm
It boosts consumer spending in the Illinois economy and that on balance is a good thing. You can’t do much as a business if you don’t have someone to sell to, nor can you do much as a business if no prospective employee can afford housing close enough to it to commute reliably.

Comment by Angry Chicagoan Monday, Oct 27, 14 @ 2:48 pm
No. Workers who show initiative and dedication quickly rise above whatever the minimum wage is.

Comment by Anonymous Monday, Oct 27, 14 @ 2:49 pm
There’s actual data on this:

http://davidcard.berkeley.edu/papers/njmin-aer.pdf

Comment by Soccermom Monday, Oct 27, 14 @ 2:49 pm
No damage that is statistically or factually verifiable.

Comment by JS Mill Monday, Oct 27, 14 @ 2:52 pm
No. What kind of businesses are paying minimum wage? I could be wrong but aren’t most minimum wage jobs, retail and service industry jobs. You can’t really decide as a business owner that the minimum wage in IL is too high so I am going to move my retail or service business (restaurant, nail salon, bathroom cleaning company, etc) to another state with lower wages. Your customers are in that state, its nonsensical to leave. Also, I would think higher minimum wage would help service and retail businesses because it would mean more money in the pockets of consumers to purchase services and retail goods creating more of a competitive environment for companies to compete over those consumer dollars.

Comment by wak Monday, Oct 27, 14 @ 3:05 pm
No. Any company looking to locate based on the lowest possible wages will not be looking anywhere in the US. If they’re coming to IL they’re looking for a quality workforce which will cost more anywhere. In a service economy, more people having more money means more income for those businesses.

Comment by Earnest Monday, Oct 27, 14 @ 3:06 pm
The type of jobs we want to attract to Illinois do not pay minimum wage. The jobs that do, such as working the counter at McDonalds, cannot be moved across the border.

Comment by Bluefish Monday, Oct 27, 14 @ 3:13 pm
Higher minimum wages benefit the State more than the individual. Raise the minimum wage, the State gets more revenue, prices for products rise, the products those minimum wage earners buy rise, and the minimum wage earner is no further ahead. Minimum wage jobs were for college age or less children and those who are less educated. The poor policies in Springfield have forced more people into low earning jobs. While a higher minimum wage will not be the single issue business doesn’t come to IL, it will be another nail in the coffin of the worst run state in the nation.

Comment by Downstate AgMan Monday, Oct 27, 14 @ 3:15 pm
If there are no manufacturing jobs, people have to work somewhere, so they’re working at minimum wage jobs. Rauner is not affected by the price of gasoline or utilities or insurance, so he doesn’t get it. Minimum wage workers are affected. I don’t think increasing the minimum wage is going to drive more businesses out of Illinois.

Comment by Streator Curmudgeon Monday, Oct 27, 14 @ 3:54 pm
It hasn’t hurt Illinois’ economy much. Most minimum wage jobs are in service and retail which don’t outsource well.

On the other hand it hasn’t helped much. More $ in lower income people’s pockets is eaten up by Illinois’ higher cost of living.

Comment by Sir Reel Monday, Oct 27, 14 @ 4:00 pm
There’s been little damage at the CURRENT minimum wage gap between Illinois and the nation, at least partly because of the higher cost of living and median income in Illinois. Only a small number of unsilled laborers and teenagers are making the min wage.

Increasing it to $13 or $15 on the other hand, makes opening or expanding a business using substantial low skill workers cost prohibitive.

There’s also the problem that many union labor jobs are indexed to the minimum wage, so it may cause an increase in much higher waged salaries as well. THAT’S a problem, especially for municipalities that were foolish enough to give SEIUers that link to the min wage.

Comment by Arizona Bob Monday, Oct 27, 14 @ 4:04 pm
Of course it has. It depends on how much has been damaged.

Comment by VanillaMan Monday, Oct 27, 14 @ 4:23 pm
The Illinois minimum wage has had a minimal impact.

High taxes, wasteful spending and government mismanagement have really done a number on Illinois.

Comment by Under Further Review Monday, Oct 27, 14 @ 4:29 pm
I’d guess “Yes,” based on the issue of “economic competitiveness” as I understand the term. Raising the minimum wage increases overhead. It’s just one of many factors affecting “competitiveness” in a particular industry. But because of the nature of the businesses that would be impacted by a higher minimum wage, I doubt the higher minimum wage would result in a major detriment,if any, to the state.
The impact is probably more local, and it could vary area to area. For instance, a sole proprietor businessman seeking to open a non-franchise fast food operation probably would shun an area with several large national franchise operators because he would be less likely to easily absorb the extra minimum wage on a razor thin profit margin.
This is a tough issue to measure and generalize on.
Frankly, I think this will become a non-issue as time goes on because many of the usually affected jobs will disappear due to decreasing costs of automation.
But it gets people to the polls.

Comment by Cook County Commoner Monday, Oct 27, 14 @ 4:33 pm
VMan, please enlighten us with some facts. After you knock off from your challenging and critical job, of course.

Comment by Wordslinger Monday, Oct 27, 14 @ 4:56 pm
Consumers with discretionary money to spend strengthen the economy by creating the market for businesses. Business should support a higher minimum…Remember Henry Ford?

Comment by DuPage Grandma Monday, Oct 27, 14 @ 6:31 pm
Go ahead, hope that Chicago raises the minimum wage to $13. Just get ready to bypass your favorite greasy spoon, favorite coffee shop and the unique friendly retail shop you have enjoyed. Just sayin.

Comment by anonano Monday, Oct 27, 14 @ 7:24 pm
Fact: Manufacturing jobs went out of the USA because of higher wages. The person currently earning $10 per hour will want $12 etc. We are in a world economy and even Senator Durbin doesn’t realize it.

Comment by Hickory Monday, Oct 27, 14 @ 7:46 pm
Some fascinating reading:

http://www.forbes.com/sites/edwardsiedle/2014/10/27/bruce-rauner-wants-it-all-public-office-plus-private-equity-secrets/

Comment by Justan Observer Monday, Oct 27, 14 @ 8:27 pm
Of course it has had a negative impact
Anyone who studied economics knows that. To what degree has it? At this point of the political spin, supporters want to believe the possibility that it has no detrimental effect.

But that’s illogical. Of course it has. Supporters just don’t want to be challenged on their political faith.

Comment by VanillaMan Monday, Oct 27, 14 @ 10:36 pm
== Of course it has. ==

Of Course? Where’s the numbers? And, seems like trying to ‘get by’ these days doesn’t count for much.

Comment by sal-says Tuesday, Oct 28, 14 @ 5:06 pm
Minimum wage needs to be raised to $9.25 per hr. The last time it was raised was in 2007 there is four states that pay more then Illinois at this time . In 1981 minimum raise was only $3.35 and now it is $7.25.

Comment by NO SENSE ! Tuesday, Oct 28, 14 @ 7:54 pm