Increases take effect July 1. Beginning Jan. Note: Vermont started indexing in but enacted additional increases in The wage rates are set for particular industries, not for an employee's particular occupation. The rates are minimum rates; an employer may choose to pay an employee at a rate higher than the rate s for its industry. The amount of the credit that can be claimed is as follows: 25 percent for the reporting period; 21 percent for ; 17 percent for ; 13 percent for ; 9 percent for ; 5 percent for ; 5 percent for ; 5 percent for , but only for employers with no more than five employees.
Their respective planned increases are below. The Secretary of Labor and Human Resources may authorize a rate based on a lower percentage for any employer who can show that implementation of the 70 percent rate would substantially curtail employment in that business.
Create Account. State Minimum Wages. Examining the positive effects of a minimum-wage increase in Illinois leads to an overarching discussion of the economic case for increasing the earnings of the lowest-paid workers during a recession.
In the current economic climate, everything is pushing against wage growth. With a queue of unemployed workers wrapping around the block for every job opening, employers do not have to offer substantial wage packages to hire the workers they need.
If employers know that there are few jobs available, they do not have to pay substantial wage increases to keep workers. Corporations can afford to increase the wages of the lowest-paid workers. Since , corporate profits have continued to soar as the American worker became more productive. Corporate America even has recovered the losses of the crash, with growth in profits returning once again to disproportionately higher rates than productivity and wages.
Yet in Illinois and nationwide, workers did not share in this prosperity. Figure B reveals this disconnect—real corporate profits peaked in at more than percent growth since , while the real value of the Illinois minimum wage in was just 14 percent higher than it was in Even conservative economists suggest higher wages might help speed the recovery. They are using that bargaining power to cut benefits and wages, and to shorten hours.
Furthermore, the unemployment rate nationally right now is 8. In Illinois, the unemployment rate is 9. That number includes the , jobs Illinois lost plus the , jobs it would have needed to add to keep up with the 2.
At that rate, it will take Illinois almost nine years to return to pre-recession unemployment levels. Considering that, in the past six months, Illinois has lost 1, jobs, a minimum-wage increase that creates 20, new jobs will improve the chance of achieving a recovery. The trifecta of persistently high unemployment, resulting lack of wage growth, and a severe jobs deficit in Illinois means there will be no upward pressure on wages for a very long time.
Since raising the minimum wage helps working families, does not cause job loss, and is a boost to the economy, the current economic downturn is exactly the time to raise the minimum wage. The multiple positive effects that would result from a higher minimum wage in Illinois are evident: boosting the earnings of working families hardest hit by the Great Recession, spurring economic growth, and creating more than 20, new jobs with no negative effects on employment.
This value is 1. The calculation of the stimulative impact of the minimum wage, however, must also account for the offsetting shift from employers. We assume employers pass on some of the minimum-wage increase to consumers through increased prices somewhere between 50 percent and 20 percent.
Taking into account the fiscal stimulus multiplier range of the minimum-wage increase. Full-time equivalent job measurements take into account both the increase in the number of payroll jobs and the increase in work hours for those who already had jobs by calculating the equivalent number of hours-per-week jobs that would be created by the GDP boost.
Measuring the number of payroll jobs strictly shows the number of jobs not measured by hours. EPI based this analysis on a legislative proposal in Illinois, S. Illinois data on minimum-wage worker characteristics reflect those of workers affected by a proposed indexing of the federal minimum wage nationwide Shierholz The EPI analysis assumes 0.
The increased wages are the annual amount of increased wages for directly affected workers, assuming they work 50 weeks per year. In a recent poll of 53 economists by The Wall Street Journal , the majority 65 percent cited a lack of demand as the main reason for a lack of new hiring by employers Izzo At 16 percent of the general fund budget, this shortfall places Illinois 11th among all states and the District of Columbia as a share of state general fund budgets McNichol et al.
This estimate is based on the dates of the national recession, not individual state recessions, which vary state to state. Autor, David H. Katz, and Melissa S. Bernstein, Jared, and James Lin. According to American Enterprise Institute adjunct scholar Richard Burkhauser, over the last two decades a majority of studies by economists conclude increases in the minimum wage directly correlate with considerable increases in unemployment and cause no decrease in poverty among the working poor.
The National Center for Policy Analysis argues minimum wage increases hurt younger workers, especially minority teenagers, who need entry-level jobs and have limited employment opportunities. If the government requires a small business to pay more than the market value of labor, the employer will often respond by simply not hiring for the job. High rates can force employers to cut back on entry-level jobs. This results in higher unemployment, and ends up hurting—rather than helping—people looking for job opportunities, especially at the lower end of the skill ladder.
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