GALENA, Ill. — Business owners in Jo Daviess County are preparing for an imminent spike in labor costs after lawmakers agreed to raise the state’s minimum wage to $15 per hour by 2025.
The rate currently is $8.25 per hour, a mark set by the Legislature in 2010. Under the new law, signed by Gov. J.B. Pritzker on Tuesday, the wage will increase to $9.25 per hour in January 2020 and will keep rising until it hits the $15 mark.
“I don’t really know what to expect,” said Nanette Glasgow, owner of Victory Cafe in Galena. “We’ll deal with it when we get there.”
The move has been widely praised by Democratic lawmakers as a necessary pay increase for low-income workers. But Republicans have lamented the potential negative impact to the already-struggling Illinois economy.
“No wage will be high enough if the jobs are siphoned over our borders,” said Illinois Sen. Andrew Chesney, R-Freeport, in an emailed statement. “Some businesses, especially in rural areas, will be forced to cut their workforce or go out of business because of this move.”
Dave Lewis, owner of the Great American Popcorn Company in Galena, said “all it’s going to do is increase the cost of everything.”
“Businesses are going to be forced to become more efficient, and some of them are going to need to cut labor,” he said.
However, other business owners see the minimum-wage increase as potentially beneficial.
Ivo Puidak, owner of the Galena Canning Company, said he believes the minimum wage should have been increased a long time ago.
“I think it’s a good thing,” Puidak said. “People are going to have more money to spend, which can transfer into the community.”
Puidak said owners of most businesses will be able to adjust to the added labor costs.
Many business owners already pay more than the current minimum wage. The U.S. Bureau of Labor Statistics estimates that the mean hourly wage of a fast-food employee in Illinois is $10.27 per hour.
“People aren’t willing to work for minimum wage right now,” said Tim Althaus, owner of Family Beer & Liquor in East Dubuque. “Most people are being paid between what the minimum wage is right now and what it is going to be.”
Althaus argued that the minimum- wage increase will help local businesses fill positions and draw applicants from Iowa and Wisconsin.
Dianne Paxton, owner of Galena’s Kandy Kitchen, said she believes the minimum wage should be increased. However, she believes many small businesses will be negatively impacted.
“It’s going to hurt the mom-and-pop shops,” Paxton said. “A lot of them won’t be able to hire anyone. Some of them are going to need to raise prices.”
Local employees have expressed their cautious optimism over the minimum-wage increase.
Jack Morgan, 17, an employee at the Great American Popcorn Company, said he likes the idea of earning a higher wage, but he’s also aware of the potential impact to employers.
“I like the idea of making more money to pay off student loans,” Morgan said. “It sounds like good news. But I know it’s going to have an impact on the small businesses.”
Lori Junk, an employee at Family Beer & Liquor, said she is looking forward to the increased pay, but she also is worried about the impact to smaller businesses.
“I’m glad that it’s going up, especially since the cost of living is going up,” Junk said. “However, there are some small businesses that I know can’t afford that.”