What’s to be done in a state that has added no net new jobs in 20 years and has the highest unemployment rate in the nation?
Order employers to pay at least $25 per hour. That’s the new position of Chicago’s powerful chapter of SEIU, the Service Employees International Union, as reported by Crain’s and ABC Chicago. It would be a 60% increase in Chicago’s current wage of $15.40 per hour.
SEIU wants candidates for Chicago mayor, alderman and other city offices to take a position on that increase, and “the group appears quite serious about that,” according to Crain’s. So far, no candidate has said no to the increase, SEIU told Crain’s. The union’s full candidate questionnaire is here.
It seems like the ink on Fight for 15 posters has barely dried. That movement to push wages up to $15 per hour might appear to be largely successful on the surface. The Fight for $15’s “success is inspirational” to labor activists, as The Guardian reported last week.
In truth, it’s hardly clear that mandatory minimum wage laws account for an apparent floor of $15 in much of America. Inflation has pushed wages up. Prices are up 30% since the Fight for $15 movement started ten years ago. It was also assisted by voluntary pay hikes by employers responding to public pressure and, no doubt most importantly, to the continuing labor shortage. Job openings in America remain stuck near a record 10.7 million. Even in much of rural America where the only legal minimum is the federal minimum of $7.25, it’s easy to find starting, unskilled jobs paying $15 hourly. I can attest myself to seeing $15 help wanted signs in rural Indiana, for example, where only the federal minimum is law.
Whatever, the cause, higher labor costs mean fewer jobs. Indifference to that simple reality is a trademark of labor progressives, and a leap to $25 per hour would be catastrophic.
This isn’t complicated. If cost goes up, supply goes down — with jobs or anything else. My daughter in college, for example, worked in a bowling alley over Thanksgiving break for $15 and I doubt the alley could pay more than that. We pay student interns $15 at Wirepoints because that’s about what they are worth. A jump to $25 would mean fewer if any interns. The examples go on and on.
Nor should it be challenging to understand that many jobs are not intended to be careers and should not be expected to pay a living wage.
For examples, look to where you can always find absurd hypocrisy — politicians. Congresswoman Jan Schakowski, while she supported Fight for $15, didn’t pay campaign workers that much. Her ad for workers offered $2,000 per month and responsibilities included “very long and irregular hours” and maintaining “7 day per week presence in office.” And JB Pritzker, while making the $15 minimum wage a key part of his first campaign, faced an organized demand from his campaign workers that he pay that much. “We demand that J.B. uphold his campaign’s values by paying his fellows a fair wage of $15 an hour,” said their petition.
Spiking mandatory wages to $25 per hour would kill countless jobs, especially in retail and part-time employment. Automatic check-outs in grocery stores, fast food and more would become all the more common. Countless restaurants would die. Students would be hit particularly hard.
For those interested in the empirical debate about the tradeoff between the minimum wage and job supply, the best compilation of research on the topic seems to be from the National Bureau of Economic Research. It reviewed over one hundred studies on the subject and concluded as follows:
Our review indicates that there is a wide range of existing estimates and, accordingly, a lack of consensus about the overall effects on low-wage employment of an increase in the minimum wage. However, the oft-stated assertion that recent research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect…. Two other important conclusions emerge from our review. First, we see very few – if any – studies that provide convincing evidence of positive employment effects of minimum wages, especially from those studies that focus on the broader groups (rather than a narrow industry) for which the competitive model predicts disemployment effects. Second, the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.Studies like those and common sense mean nothing to the job killers who run Illinois. A serious effort to lift wages would mean getting off employers’ backs and pushing the unemployed to take the many good wage, career jobs already available, as in manufacturing, and telling people to move to where those jobs are if necessary. It would also mean restoring the state and the nation to the kind of high growth economy like we had only a few years ago, which pushed up wages naturally by putting workers in the driver’s seat.