Lou Lang: Illinois Minimum Wage Hike for 400,000 Workers, 70,000 New Jobs Boost Illinois Economy, Governor Pat Quinn

House Deputy Majority Leader Lou Lang (D-Skokie)

(Skokie, IL) — July 20, 2010. The Illinois economy has recently generated some welcome news on a couple fronts for both Illinois workers and Governor Pat Quinn.

First, the Illinois minimum wage increased to $8.25 an hour on July 1, after increasing to $8.00 only a year ago, while, second, the state witnessed an increase of 70,000 new jobs since January, defying naysayers who said a minimum wage hike would kill job growth.

According to an Economic Policy Institute study, the increase in the minimum wage will help over 409,000 Illinois workers confront the rising cost-of-living and better afford basic necessities like groceries, gas, rent, childcare and medicine, while simultaneously helping to boost the Illinois economy.

“The Illinois Department of Labor has worked diligently to ensure workers receive fair wages, so they can meet their basic needs and have the ability to spend more, which in turn helps stimulate the economy,” said Director Catherine Shannon.

Illinois’ minimum wage rose, due to legislation that I supported, to $7.50 an hour in July 2007, with automatic increases of 25 cents per year built in over the next three following years to $7.75 on July 1, 2008; $8.00 on July 1, 2009; and $8.25 on July 1, 2010. This is the last automatic increase provided for by the law.

Illinois is one of 14 states with a higher minimum wage than the federal standard of $7.25. Only Washington ($8.55) and Oregon ($8.40) have higher minimum wage rates than Illinois. In the Midwest, only neighboring Michigan, at $7.40 per hour, joins Illinois, exceeding the federal level.

Raising the minimum wage to $8.25 an hour will generate an additional $520 in annual wages for a full-time minimum wage worker, up to $17,160 per year. Additionally, full time minimum wage workers in Illinois will earn $2,080 more in annual wages than workers receiving the federal minimum wage of $7.25 an hour, according to the Illinois Department of Labor.

Violators of the minimum wage will face state investigations to help ensure compliance with the law.  In 2009, the Illinois Department of Labor conducted over 1,500 investigations of alleged violations and collected over $1.4 million in underpaid wages to Illinois workers.

Workers under 18 may be paid 50 cents less per hour less than the adult minimum wage. Tip credits may be up to but not exceed 40 percent of the minimum wage.

In a study by the Voices for Illinois Children, the child advocacy group found that more than 80% of minimum wage workers in Illinois are working adults, not teenagers, and one-third of minimum wage earners are sole breadwinners for their families. Additionally, approximately 144,000 of the workers who would benefit directly from the minimum wage increase are working parents and nearly 60% of them are women.

Not every one, however, is a fan of the minimum wage.

Kim Maisch, Illinois Director of the National Federation of Independent Businesses, recently claimed that state lawmakers in 2006 failed account for a potential economic downturn in which businesses would be less able to cope financially with a minimum wage increase.

“This is a classic example why lawmakers should not build in automatic increases to the minimum wage.”

However, the Illinois seasonally adjusted unemployment rate dropped -0.4 points from 11.2% to 10.8% in May, according to data released recently by the Illinois Department of Employment Security. The over-the-month decline is the largest since October 1983.

Additionally, Illinois has added 70,000 jobs so far this year, more than any other midwestern state, according to department data.

“Five months of positive job growth coupled with two consecutive months of declines in the unemployment rate offer reasons for cautious optimism,” Director Maureen O’Donnell said.

While the Illinois unemployment rate remains stubbornly and unacceptably high–and above the national rate of 9.5%–70,000 new Illinois jobs and more than 400,000 workers with more money in their pocket will help jump-start Illinois’ economic recovery.

This is good news for workers and Quinn who is looking to hold onto his job in November.

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Lang’s Jobs Task Force Wants to Kill Truck Fee; Redo EPA E-Waste Rules that Trip Up Motorola; Boost Business Micro-loans

Illinois truck regisrations have dropped since 2003.

(Chicago, IL) – July 13, 2010. Illinois truck registration fees are currently $1,400 more than the average of states surrounding Illinois, in part, because of a special $400 fee imposed by the state legislature in 2003, and a new legislative panel report now recommends abolishing the fee.

“Truck registration fees are driving down truck registrations compared to the increases seen in the states that surround Illinois and, ultimately, driving business away from Illinois,” said Deputy House Majority Leader Lou Lang (D-Skokie), Chairman of the House Bipartisan Jobs Creation Task Force.

Lang estimates that if Illinois kept up with the national average, it would have 35,653 more trucks than today’s current count of 163,453.

Using the 163,453 trucks that were registered in Illinois in 2008 versus 175,064 in 2003, a repeal of the Commercial Distribution Fee would cost the state approximately $65,381,200, Lang says.

“If Illinois sees a growth of approximately only 23,426 trucks, the elimination will be revenue neutral, but will create a substantial number of new Illinois jobs,” said Lang. “The task force proposes to eliminate the Commercial Distribution Fee on intra-state operators which is approximately $400 a truck.”

In contrast, Indiana had 94,068 truck registrations in 2003 and 201,848 in 2008.

In addition to truck fees, Lang’s task force, which included 54 House lawmakers and held public hearings Chicago, Decatur, Rockford, Naperville, Palatine, and Springfield during the spring, lays out multiple job creation and business boosting initiatives, including reigning in environmental regulations that are undermining its own objectives.

Lang cited the case of Motorola. At a hearing, Motorola pointed to the recent Illinois E-Waste law in which Motorola was initially provided with a recycling letter of exemption, but was hit with demands from the Illinois Environmental Protection Agency which undermined its e-waste recycling.  Although Motorola had been recycling these materials well before the passage of the Illinois law, the administrative and auditing requirements made the program cost-prohibitive.

“The unintended consequences of the law stifled the very practice the law was designed to encourage and represents an area in which the implementation has been inconsistent,” said Lang.

“The task force proposes to make the new e-waste regulations pertaining to the management of the proper disposal and recycling of materials used in technology products, such as cell phones.”

Lang also noted that the financial crises has stifled community bank and credit union lending to startup entrepreneurs and small businesses, but a new program, proposed by State Treasurer Alexi Giannoulias, whereby the state would act as the guarantor for qualified small business loans issued by community banks and credit unions could boost business.

“The program would provide a 10%-20% state guarantee for loans to small businesses that could not otherwise be secured through traditional financing,” said Lang. “This 2-year pilot loan program is designed to bridge the gap between loans from family and friends and traditional SBA loans.”

Lang assured that to minimize the state’s financial exposure, both interest and fees would be charged and set aside as an insurance fund.

“Illinois needs to be creative to help businesses get the credit they need to create jobs,” said Lang.

The full report can be found at: http://www.housedem.state.il.us/index2.htm