A bill aimed at raising the minimum wage to $15-an-hour is unsettling to one of the state’s largest lobbying organizations.
The measure, sponsored by State Representative Will Guzzardi of Chicago, would raise Illinois’ minimum wage to $15 per hour by 2022.
With a vote pending, the Illinois Retail Merchants Association is expressing their opposition to the bill. IRMA President and CEO Rob Karr provides some examples of how the bill could affect the state’s retailers.
“It constitutes an 81.8 percent increase in the largest or second largest line item of every retailer over five years, that’s 16.36 percent increase every year in their largest expense item. I would challenge anyone, for example a resident: if your mortgage or car payment increased 81.8 percent in five years, could you still afford your home or your car? I think the answer for most people is going to be no, and for retailers, it’s the same thing, how can they afford to make this type of increase?” says Karr.
Karr says the effects of this bill would go beyond simply raising the minimum wage.
“At this rate, the state is going to kill the largest source of revenue for local governments. It’s not just the minimum wage that’s being proposed here, there’s leave mandates that costs the employers money, there’s the tax increases that are going to come from the state at some time in order to bail out their fiscal situation. Then there’s locally imposed taxes, not to mention pressure from internet sellers, and that increases the pressure as well on retailers. So it’s not just the fifteen dollar proposal, it’s everything in combination, which is how retailers have to look at things,” Karr explains.
Karr explains the type of burden he believes this measure would put on local governments.
“For local governments, often times retail sales are their largest single source of revenue, so anytime it gets harder to do business as a retailer, and they have limited ability to manage their costs, they have very few options…and the worst case scenario is they have to close. Illinois is losing tens of thousands of people every year, so where government expects retailers to make up these sales to be able to afford these types of increases is beyond anyone’s guess. You can’t do it when the population is declining,” says Karr.
After passing a House Labor committee on Sunday, the measure is expected to reach the House floor for a vote before the end of day Wednesday.