Minimum wage increases to $7.50 per hour

CHICAGO—Illinois Gov. Rod R. Blagojevich (D) announced the state’s new minimum wage of $7.50 an hour took effect July 1, helping nearly 650,000 workers pay for basic necessities like groceries, rent, gas, childcare or medicines.

The governor also reminded Illinoisans that if they work for the minimum wage and are not receiving it, they should call the Illinois Department of Labor’s hotline at 1-800-478-3998 so the state can help them get the wages they’re owed.

Last December, Gov. Blagojevich signed legislation boosting Illinois’ minimum wage to $7.50 an hour—$2.35 higher than the federal minimum wage of $5.15 an hour—with incremental increases each year up to $8.25 an hour in 2010.

Blagojevich said: “A person who works 40 hours a week should earn enough to care for their family and afford basic necessities. I’m proud that in Illinois we’ve kept our promise to help working people and make their lives easier after years of neglect at the federal level. As Illinois’ minimum wage moves up today to $7.50 an hour, it will be a little easier for thousands of Illinois families to pay their bills, put food on the table, or buy clothes for their kids. Workers deserve a fair wage for their hard work, and they deserve a wage that keeps up with the increasing cost of living.”

Beatrice Jackson, president of the Illinois chapter of the Association of Community Organizations for Reform Now (ACORN), said: “For thousands of working families who live on the brink of poverty, the increase in Illinois’ minimum wage will help workers afford basic necessities that so many of us take for granted like food, clothing, housing and education. I applaud the governor and the legislature for continuing to ensure that Illinois’ low-wage workers earn more for their hard work and for making a higher wage a reality for thousands of workers in Illinois.”

Michael T. Carrigan, president of the Illinois AFL-CIO, added: “Thanks to the hard work and diligence of Gov. Blagojevich, state lawmakers, labor leaders and workers’ rights advocates around the state, Illinois now has one of the most progressive minimum wage laws in the country. Beginning today, minimum wage workers will see a steady increase in their pay each year over the next four year. By 2010, Illinois’ minimum wage will be $8.25 an hour. This small, but critical, pay increase will help working families pay for everyday essentials and, hopefully, improve their quality of life.”

This is the second minimum wage increase Blagojevich has championed. The first increase, signed into law in 2003, raised the minimum wage from the federally mandated level of $5.15 an hour to $5.50 an hour in 2004 and $6.50 in 2005. Prior to that initial increase, minimum wage earners were suffering a significant loss in purchasing power, as the federal minimum wage remained stagnant for nearly a decade.

When Blagojevich raised the minimum wage to $6.50, it boosted the annual income of a full-time minimum wage worker to $13,520, lifting a two-person family above the 2005 federal poverty level of $12,500. However, in the two years since that increase took effect, the federal poverty level for a two-person household rose to $13,200, reflecting higher costs of living and rising consumer prices for energy, groceries and other staples. Without another increase in the minimum wage, Illinois workers earning $6.50 an hour would have continued to earn a wage at or near the poverty level.

The new law boosts Illinois’ minimum wage from $6.50 an hour to $7.50 an hour, with further 25-cent increases until reaching $8.25 in July 2010. Raising the minimum wage to $7.50 an hour will generate an additional $2,080 in annual wages for a full-time minimum wage worker—up to $15,600 per year. For a two-person household in which each person works full-time and earns the minimum wage, that means an increase of more than $4,160 a year to spend on basic needs. When the final rate of $8.25 per hour takes effect in 2010, Blagojevich will have helped boost the pay for minimum wage workers in Illinois by $3.10 per hour, or 60 percent in seven years. This makes Illinois a national leader in raising wages for low-income workers.

Research has shown that a higher minimum wage contributes to more jobs, a stronger economy and a better quality of life. The Economic Policy Institute and Voices for Illinois Children found that approximately 144,000 of the workers who would benefit directly from the minimum wage increase are working parents and nearly 60 percent of them are women. More than 80 percent of minimum wage workers in Illinois are working adults, not teen-agers, and one-third of minimum wage earners are sole breadwinners for their families. Increasing the minimum wage will help boost the standard of living for 269,000 Illinois children.

Jerry Stermer, president of Voices for Illinois Children, said: “Improving our state’s minimum wage will help working families throughout Illinois to better handle the rising costs of their ‘basics,’ from housing and food to transportation and utility bills. We applaud the governor and state legislators for taking this substantial step. And we must continue these kinds of policy efforts to help low-wage workers provide for their families.”

Illinois Department of Labor Director Catherine Shannon said: “Starting today, the department will enforce a higher minimum wage of $7.50 an hour in Illinois, so businesses and workers should familiarize themselves with the law’s new requirements. We are conducting extensive outreach to create awareness and ensure compliance with the law, and we remain committed to making sure workers receive the wages they’ve earned.”

The Illinois Department of Labor is reminding employers and employees about the new minimum wage taking effect by distributing required postings to business groups, labor unions, public officials, civic and community organizations, as well as posting information on its Web site, ,and developing multi-lingual public service announcements for radio and print media, including in Spanish and Polish.

from the July 11-17, 2007, issue

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