Anderson: Minimum wage proposal detrimental to northwest region

State Senator Neil Anderson opposed legislation that would increase Illinois’ minimum wage to $15 statewide over the next six years. Senate Bill 1 passed the Senate Thursday despite Anderson’s call for further negotiations and regional protections.

“The economic diversity of this state is something that must be considered when discussing a minimum wage increase,” said Sen. Anderson. “The differences of Chicago versus my region of the state are vast and need to be examined. Residents in my region already have no problem hopping over the border to Iowa, what will happen when Illinois businesses are forced to take their business, the jobs they provide and the taxes they pay across state lines? They won’t think twice about going elsewhere.”

Sen. Anderson added that the 82% increase included in this proposal is expected to not only take a massive toll on small and local businesses, but non-profits, universities, nursing homes and government agencies will also see major impacts.

In fact, according to Governor Pritzker’s own numbers, a $15 minimum wage would increase annual state payroll by more than $1 billion. Anderson also noted the following implications:

  • Nursing homes can expect to see as much as $1.5 billion in increased Medicaid reimbursement costs from the state.
  • The University of Illinois estimates an additional $73.5 million a year in salary costs, which raises the concern of increased tuition rates.
  • Senior citizens on social security would see a rise in their cost of living and working parents would see a rise in childcare costs, even though these individuals won’t be getting an 82% increase in their income.
  • Encourages large corporations to automate their systems and provide less jobs.
  • Illinois companies’ ability to compete with those in other states would decrease.

“Those impacted the most are our not-for-profit organizations, who cannot take advantage of the weak 25% tax credit provided in the bill because they don’t pay income taxes,” said Sen. Anderson. “The implications of this proposal go on and on. The cost of living will rise and everyone will pay more for groceries, supplies, and gas. We’ll be right back to where we started, except for the middle class, which will be pulled down closer to poverty level. The State of Illinois surely can’t afford to pay for this, and its residents can’t either.”

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