Raise Chicago: How a higher minimum wage would increase the wellbeing of workers, their neighborhoods, and Chicago’s economy
Abstract
In this paper, we find that the targeted $15 minimum wage will: - Increase wages: $1.47 billion in new gross wages - Stimulate Chicago’s economy: $616 million in new economic activity and 5,350 new jobs - Increase city revenues: Almost $45 million in new sales tax revenues - Decrease labor turnover: as much as 80% less annual turnover - Slightly increase some consumer prices: 2% price hikes at covered firms and franchises
In a March 18, 2014 advisory referendum, 86% of Chicago voters decided to support a proposal to raise the minimum wage to \$15 for Chicago workers at firms with \$50 million or more in annual receipts (and at their subsidiaries and franchisees). This initiative allows Chicago to enable workers to get a toehold on the rockface to the middle class, rather than wait on state and federal government action. It offers the opportunity for the city to stimulate and strengthen its economy in the near term. It promises to enable individuals to invest more deeply in themselves, their families, and their communities.
In accordance with the principles of a well-tuned, consumer-driven local economy, this proposed measure would enable Chicago’s economy to perform better while increasing opportunity and wellbeing for more of the city’s low-wage residents.