Minimum Wage

For the first action project in Policy I was asked to find a current piece of legislation that I wanted to amend, veto, or pass and send a letter to the person who I felt could influence it the most. I chose to try to get the raise in minimum wage in Illinois to be reverted. This was not an easy project to do as finding legislation on specific topics is much more challenging than I thought. It took me a week to figure out which legislation I was passionate enough to write about. Then the next challenge was to make the letter approachable and not to make it too severe so that it wouldn’t get read.

1862 North Dayton Street

Chicago, Illinois

May 8th, 2015

Mrs. Kimberly Lightford

Senator

Illinois Senate

10001 Roosevelt Rd # 202

Westchester, IL 60154

Senator Lightford,

Imagine Illinois losing 21,000 people from the work force and 4.5 billion dollars in economic output, crippling Illinois even further from progressing and achieving its goals (Nfb.com). This is the Illinois we will all live in if the minimum wage is raised to 11 dollars an hour. An increase in the minimum wage is a bad idea because it puts pressure on businesses that rely on low wage labor by increasing their costs. To compensate for the loss in profit, companies will either raise their prices or fire employees causing inflation and unemployment. The hike in wages will be meant to allow people to receive a more livable wage but instead will make the cost of living even greater while decreasing jobs.

As a highschooler at GCE Lab School I lack the qualifications of those that would normally address you,  but I have had some experience in helping with the accounting of a store that needed cheap labor to operate. I worked at a store in Wrigleyville that teaches kids how to build robots through birthday parties, camps, and different events around Chicago. To maintain their ability to teach a plethora of children, they have a large staff. This staff, however, is paid $9 an hour because that is what the store can afford if it is still to make a profit. If the hike in minimum wage takes place, the company will start having to pay its employees more and more to the point where they cannot afford to keep such a large staff without raising the price of the robots. The issue with this is that robots are already expensive and out of the reach for many families, so instead, to keep market competitiveness, the store needs to fire some employees. With a smaller staff the store cannot attend all of the same events as they used to because they can’t man them, causing a loss in revenue and ultimately the failure of the company.  This will be the fate of a lot of small businesses that are struggling to make it as it is. Of an estimated 21,000 people losing their jobs due to the increase of wages, about two thirds will come from small businesses (Illinoispolicy.org).

Place yourself in the shoes of a salesman at a hobby store working 9-5  six days a week. Just out of college, you know that your skill set isn’t too unique, but you need a job so you can enter the workforce, gain some experience, and then move up in the world. Barely surviving on your minimum wage job, you consider it is a blessing to have your wage increased. However, as your wage increases so does the price of everything in the store. Due to the increased prices fewer and fewer people are coming to the store. The owner--in order to save his business, his childhood dream--lays you off and starts working himself as a salesman. Now you go out looking for a job only to realize that there are already huge numbers of people searching for jobs, and still the cost of living is rising due to the necessity for companies to minimize the loss to their profits.

The argument could be made that the increase in wages will give the lower class more purchasing power and give them an income that can support a family. However, the increase will cause the opposite. It will cause cost-push inflation reducing purchasing power and making the wage worthless. While $8.25/hour may not be a wage that can support a family, the fact is that neither can an $11/hour wage with the inflation that is sure to come.

The repeal of SB 0011 of the 99th General Assembly, which amends 35 ILCS 5/704A and 820 ILCS 105/4, needs to happen otherwise Illinois will be in economic turmoil. An increase in minimum wage will force businesses to pay their employees more and to increase their prices, causing some businesses that don’t adapt fast enough to fail because they cannot afford the loss in profits. It will also make it harder to start a business because the startup cost will be higher. The American Dream, that makes this country one of the greatest in the world, is supposed to allow anyone who tries hard enough the ability to found and run their own business; however, raising the minimum wage makes this dream unobtainable.

Sincerly,

James Curcio