Before a new Republican governor can take office in the state, Chicago Mayor Rahm Emanuel called a hastily-assembled “emergency session” and passed a city ordinance raising the minimum wage.
As Chicago sits on the edge of bankruptcy, Mayor Emanuel was desperate to beat the state legislature to a raise of the wage. His measure raised it from $8.25 an hour to $10 by next July and as high as $13 by 2019, a nearly five-dollar-per-hour hike.
A few lonely voices in the city council–the measure easily passed 44-5–are saying that in a state that is already losing population and businesses to other states, a minimum wage hike will drive out even more small businesses.
“Make no mistake, this will cost thousands of low wage jobs throughout Illinois as businesses flee,” said a joint statement from the Chicagoland Chamber of Commerce, the Illinois Restaurant Association, the Illinois Retail Merchants Association and the Illinois Hotel and Lodging Association published by the Chicago Tribune.
As IBD.com reports, “Moody’s Investors Service has downgraded Chicago’s credit rating by three notches, partly the result of $19 billion in unfunded pension debt. In the first decade of this century, the city lost 7.1% of its jobs. Its famous Loop, the second-largest business district in the nation, has reportedly lost 18.6% of its private-sector positions.”
That isn’t all Illinois has lost. In the last decade The Land of Lincoln became one of the top states for citizen flight, losing more citizens than any other state except New Jersey.
Worse, if the minimum wage is raised for the entire state, Illinois will likely find that it will stay as one of the worst states for small businesses in the country.
Incoming Republican Governor Bruce Rauner stumbled over the minimum wage during his successful campaign for governor, at first saying he was completely against a wage hike, then saying he could be for it, then still later saying he would support a small hike. Now, after the City Council voted its hike, Rauner said it will certainly hurt the city’s competitiveness.
Rauner did stick with his support of a raise in the wage but only if it is coupled with reforms.
“Raising the minimum wage doesn’t help somebody (who is) unemployed, and it doesn’t help somebody who’s employed today and could get unemployed because of the lack of competitiveness that raising the minimum wage could engender,” Rauner said on Thursday.
Follow Warner Todd Huston on Twitter @warnerthuston or email the author at email@example.com.