New Illinois minimum wage law to challenge small businesses

Businesses are wondering how the change will affect operations, especially those that have locations in both Illinois and Indiana.

New Illinois minimum wage law to challenge small businesses

MOUNT CARMEL, IL (WFIE) - Illinois is the fifth state in the nation and first in the Midwest to pass a $15 minimum wage plan into law.

Governor J.B. Pritzker signed the six-year plan on Tuesday.

It raises the statewide minimum wage from $8.25 to $15 an hour gradually. It will increase by one dollar every year until it reaches $15 by 2025.

Businesses are wondering how the change will affect operations, especially those that have locations in both Illinois and Indiana.

Taco Tierra’s General Manager Christi Smock said there will be adjustments made in the near future. Smock oversees the Princeton, Indiana location and two southern Illinois restaurants.

“We just found out, we aren’t sure yet," Smock said. "We will have to have a lot of powwows and figure out what we want to do.”

Smock said with the minimum wage differences in each state, she is concerned with staffing.

“We will have to adjust hours. Of course because later at night, we don’t always get a lot, so we will have to cut back the number of staff, too,” Smock explained. “But, the product will stay the same.”

Smock said the new law impacts more than just employee paychecks.

“Yes, prices will raise. Probably not at the start. But, probably by mid next year," she added.

Smock said the fate of other small businesses could be in jeopardy. She hopes for other businesses to stay healthy.

“We do not plan to close," she said. "Some of the other mom and pop shops, they may not be able to make it. But they may, I don’t know. Hopefully everything goes well for every one.”

The boost in the minimum wage has not been popular with small businesses outside of Chicago.

Critics argue it will lead to job cuts and businesses leaving the state.

Governor Pritzker says there are payroll tax credits in the law, to ease the transition for businesses in the state.

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