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Stakes are high for workers, businesses as Illinois considers minimum wage hike

Monday, April 17, 2017
Chicago Tribune
by Alexia Elejalde-Ruiz


Stakes are high for workers, businesses as Illinois considers minimum wage hike

Business was slow one brisk spring morning at the Dairy Queen in suburban Northbrook. Bernadette Simpson, manning the Blizzard machine, churned an ice cream treat and then made a show of holding it upside-down to demonstrate its gravity-defying thickness, as company policy requires her to do.

Simpson, 48, started working at Dairy Queen two years ago for $8.50 an hour, a quarter more than the state's minimum wage, and now earns $10.25.

She enjoys the job — "How can you not be happy working with ice cream?" she said — but scrapes by.

"I clip coupons, we look for sales, we keep things very low-key and we try to save as much as we can," said Simpson, a single mom of two who lives with her teenage daughter in Buffalo Grove.

"All change goes into a jar that's not touched, and come the end of year we take it to the bank and trade it for cash for the holidays."

Scraping by was not part of Simpson's original plan. She went to nursing school and worked in health care before she left to raise her kids and care for her ailing grandmother. But when she tried to go back to work 15 years later, after her grandmother died, employers wouldn't hire her because she'd been out of the workforce so long, she said.

So Simpson joined the swelling ranks of low-wage service workers, who increasingly look more like her: older, raising families, without many other options.

As Illinois considers raising the minimum wage to $15 an hour, up from the current $8.25, advocates say the changing face of the low-wage worker is a reason why the minimum wage must be a living wage.

But some businesses insist a hike could kill them, causing more harm to workers and communities than good.

Ed Schubert, whose family owns the Dairy Queen franchise where Simpson works, said he can't imagine how he'd keep his shop afloat with a $15 minimum wage, a rate he thinks shouldn't apply to his largely teenage staff.

"I'd give us five years and we'd be out of here," said Schubert, 66, who bought the shop nearly 44 years ago. "Whether we sell it to somebody or just be done, I don't know."

Even Simpson is on the fence about supporting a statewide hike, uncomfortable with the notion that her 16-year-old would make that much out of the gate.

Still, she said, for herself a bigger paycheck "would be fabulous."

Illinois legislators are considering a bill introduced by House Democrats to slowly raise the state's minimum wage to hit $15 by 2022, following the example of California, New York and Washington, D.C., as well as several cities. The first increase, to $9, would go into effect Jan. 1. Small business owners — but not franchisees — would get tax credits at first to help.

The bill recently cleared a House committee and will go for a vote before the full House possibly this month, though even if it passes in the House and Senate it could face a veto by Republican Gov. Bruce Rauner. Rauner has said that he supports a smaller increase in the minimum wage as part of a larger effort to reduce regulations on businesses.

One survey found Illinoisans to be skeptical. TSheets, a time-tracking software, polled 500 Illinois residents and found two-thirds said they believed the $15 proposal would fail and nearly half said they did not support it; another 20 percent were indifferent. But they didn't support the status quo, either. Only 6.5 percent of those surveyed believed the minimum wage should stay at $8.25. A raise to $12 was the most popular choice.

Workers, on one side of the debate, and businesses, on the other, both say it's a matter of survival.

To Tanya Moses of south suburban Harvey, who earns $10.50 an hour working as a home health aide, it's also about respect.

"For people to think that this isn't an important job, something's wrong," Moses, 58, said. "We don't want to pay the people to take care of the people."

While fast-food and retail workers often are the face of minimum wage, low-wage work is widespread in health care, and home health aides are among the fastest growing segments of the labor market.

The number of home care workers in the U.S. has doubled in the past 10 years, to about 2.2 million, and the field is projected to add another 634,000 jobs by 2024, according to the Paraprofessional Healthcare Institute. But they are paid little and have inconsistent hours.

Last year, cobbling together 21 hours of work a week with three clients, Moses went two months without lights in her home because she chose to pay the gas bill instead of the electricity bill. She didn't tell the neighbors, embarrassed to be without lights at her age, and filled her house with thick candles.

"The house smelled good all the time," Moses chuckled.

Moses works for Addus HomeCare, which serves 33,000 customers weekly in 24 states. More than half of its $401 million in service revenues last year came from Illinois, paid mostly by the state's Department of Aging, according to its annual report.

President and CEO Dirk Allison said in an emailed statement that "Addus supports higher pay rates for the hardworking and dedicated team that provides such valuable services to our aging adult population."

He added: "It is also important that wage increases be funded through adequate rates of reimbursement by the state."

Moses, who speaks with don't-mess-with-me urgency, said $15 hourly pay might allow her to pay both the gas and electric bills, perhaps get her off of public assistance.

She spoke as she swept the kitchen floor of her client Lee Williams, an 84-year-old widower whom she calls "Mr. Lee." Williams lives in an apartment in the Chatham neighborhood on Chicago's South Side that he shared with his wife of 54 years. Since she died three years ago, Williams said he needs help cleaning, cooking and paying bills.

Moses grew up nearby. She shimmied a bit as she recalled the dance lessons she took in Tuley Park, then described a rough adolescence. Turned out of the house by an abusive stepfather when she was 13, she slept on the streets and worked at McDonald's earning $1.90 an hour, she said.

The experience gave her sympathy for other people's struggles. A few years ago she took in a pregnant young woman who was living in a condemned home. Moses now lives with her and her two kids, aged 2 years and 9 months, relying on the young woman's Link card for food.

The young woman makes minimum wage at a pizza restaurant but her hours are unreliable, Moses said, so she's training to become a home health aide as well.

Moses spent that morning making Williams breakfast, washing the shiny buildup off the bathroom walls and scrubbing the oven, but the job is about more than that, she said.

Williams hadn't received his diabetes medication so they called the pharmacy to make sure it came the next day, Moses said. And a broken smoke alarm had been beeping for a week when she arrived.

Moses has little patience for what she sees as broad disregard for people, whom she is committed to helping.

She said she was sickly when she was young and spent time in hospitals, which shaped her view.

"The way doctors and nurses was then, they was nasty," Moses said. "So my thing was, I'm going to grow up and be a nurse and take care of people, because they don't have no care for nobody, no compassion. So that has been my goal."

Moses worked as a certified nursing assistant and ran an assisted living facility, but her goal to become a nurse got waylaid — "marriage and kids and life," she explained. She stopped working to take care of her mother, who died in December, and now has to retake the certified nursing assistant test if she wants to practice again.

Moses, a union activist with SEIU Healthcare Illinois, which represents about 50,000 of the state's home health care and child care workers, said she is focusing her energy now on the wage fight. She has scaled back work to one day a week while she undertakes an internship with the union, which pays her $15 an hour to sign up new members and organize existing ones.

It isn't easy, she said. Many workers resent the 3.3 percent taken out of their paychecks for union dues.

"If I don't go out there and speak for these people to get this money, they're not going to get it," Moses said.

Across town at the Northbrook Dairy Queen, other concerns weighed on Ed Schubert.

He's been trying to retire, and last year he transferred management to his daughter, Jennifer Spencer.

Spencer, 44, has worked at the Dairy Queen since she was 14, and though she left for a time to work on a factory assembly line, she found her way back. She got married at the Dairy Queen, saying her vows in front of the cash registers. Her son works there too.

"There's too many memories, I couldn't give it up," Spencer said.

But Schubert doesn't see how the math will work with a $15 minimum wage.

He aims to spend 20 to 25 percent of his revenues on payroll, with the rest of his budget consumed by rent, operating costs and corporate fees. During a typical year he is left with a modest profit of 3 to 4 percent, which ranges from $30,000 to $60,000.

Schubert doesn't think he could boost revenue enough to absorb a big rise in payroll costs. He calculates that if he has 10 people working for him on a busy summer Saturday, he would have to do $400 in sales each hour. Now, he's "not even close."

Raising prices is a possibility. But Schubert estimates he'd have to increase prices by 10 to 20 percent, and he worries that such a hike would hurt sales.

Schubert, who hires many teens during the summer, advocates for a "three-tier minimum wage," which takes age into account. His suggested breakdown: Teens 14 to 17 earn at least $7 or $7.50 an hour, 18- to 23-year-olds earn a minimum of $10, and adults 24 and up have a minimum of $13 an hour, which is the minimum approved by Chicago and Cook County. (Chicago is slowly stepping up its minimum wage to $13 by 2019 and Cook County will reach $13 by 2020, though several towns have opted out of the county law.)

With that mix, Schubert said he could make it work. Without it, teens could find themselves out of a job because they can't compete with more experienced workers, he said.

As Schubert worries about what might happen if the wage goes up, Moses worries about what has happened because it hasn't.

Crime might not be so bad if parents didn't have to work two jobs and leave their kids alone, she said.

A common argument against raising the minimum wage is that people who don't like what they're making should work harder or try a different field.

Moses said that's not the point. Costs have gone up while wages have not.

"How are you going to pay the cost of living if minimum wage doesn't go up?" she said. "How? I mean, seriously?"

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