Wage Regulations Will Hurt, Not Help, Workers

Published June 23, 2006

Dear Editor:

The Chicago City Council’s efforts to “make ‘big box’ retailers toe wage line” [June 22] will have two major effects. First, any attempt to legislate a higher wage will raise the cost of employing workers, and consequently fewer workers will be hired.

Second, because the legislated higher wage will raise the cost of doing business in the city, there will be an increase in prices. Businesses forced to pay higher wages will try to recoup that expense by charging higher prices. At the same time, because some businesses will be deterred from operating in the city due to wage regulations, there will be fewer competitors. Less competition will enable those businesses already in the city to charge higher prices.

The wage measure is nothing more than special-interest legislation aimed at benefitting established ‘small box’ retailers at the expense of workers and consumers.


John Semmens

John Semmens ([email protected]) is an economist with more than 30 years’ experience. He serves as a policy advisor to The Heartland Institute.