Democrats with backing from labor have made raising the federal minimum wage a leading campaign theme while highlighting America’s growing gap between rich and poor.
They argue the nation’s lowest earners haven’t seen a raise since 1997, when the minimum was adjusted to the current $5.15-per-hour level. Inflation, meanwhile, has eroded the wage’s buying power to its lowest level in decades.
If the federal minimum were increased to $7.25, nearly 15 million workers would get raises, 80 percent of them adults, and more than 7 million children would see their parents’ incomes rise, according to the Economic Policy Institute, a liberal think tank.
Republicans counter that a proscribed higher minimum would hurt the very workers Democrats propose to help because businesses would be forced to trim payrolls to pay for the mandatory increases.
Retailers and small businesses are hit hardest by higher wage floors, according to a study by conservative think tank Employment Policies Institute. The group cites a study associating a job decline of about 1 percent among retailers and small businesses when the minimum wage rises by 10 percent.
Democrats also are backing minimum-wage ballot initiatives in six states from Montana to Ohio.
In Illinois, one of more than 20 states with higher minimum-wage floors, Gov. Rod Blagojevich wants to boost the hourly minimum by $1 to $7.50 with automatic annual cost-of-living increases, which he says would affect at least 500,000 workers.
“When the cost of gasoline goes up, the cost of living goes up (and) minimum-wage workers will see an indexing that will recognize those realities,” Blagojevich said in a recent campaign speech.
He vowed to push his plan in the General Assembly’s fall veto session, which is scheduled to begin Nov. 14, one week after the election.
Republican challenger Judy Baar Topinka favors an increase in the federal minimum wage because she says Illinois’ higher minimum places the state at a disadvantage when competing for jobs. She argues Illinois has fallen to near the bottom of the pack–No. 42–in job creation because of policies that make it expensive for companies to do business here.
