Illinois has maintained the horrible distinction of having the nation’s highest black unemployment rate for the 15th month in a row, according to a new analysis from the Economic Policy Institute, or EPI. Illinois’ black unemployment rate is 14.2 percent, compared to the next highest state, Pennsylvania, at 11.8 percent.
Illinois’ slow economic growth and weak industrial job creation, along with heavy regulations on occupational licensing and poor school options for many minority children have had a pronounced effect on black job opportunities. Ironically, for almost the same duration of time that Illinois has had the highest black unemployment rate, Illinois’ Democratic legislative leaders have insisted economic reforms are unnecessary for Illinois’ economy, putting them at odds with Gov. Bruce Rauner.
House Speaker Mike Madigan, in particular, has painted Rauner’s economic growth legislation as an attempt to decrease the wages and standard of living for middle class Illinoisans. This begs the question of what Madigan considers to be the standard of living for minorities who can’t find work in Illinois at any wage level. With the highest black unemployment in the country, too many Illinoisans are learning first hand about the standard of living they’re condemned to in Madigan’s Illinois.
The difference between the white unemployment rate and the black unemployment rate is greater in Illinois than in any other state. According to the EPI’s study, Illinois’ black unemployment rate is 14.2 percent and Illinois’ white unemployment rate is 4.9 percent.
While policymakers aren’t working to alleviate this problem, Chicago and Cook County have made it worse. Cook County, following Chicago’s lead, enacted an ordinance to raise the county’s minimum wage to $13 per hour and then tie increases to inflation. However, research shows that minimum wage hikes hurt employment prospects, especially for low-skilled and minority communities.
A National Bureau of Economic Research survey of minimum wage studies found that minimum wage increases especially affect the least-skilled workers in the economy. In particular:
the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.
Cook County is home to 1.26 million of Illinois’ black residents, out of Illinois’ 1.89 million total black residents. That means the minimum wage ordinances passed in Chicago and Cook County affect two out of three black residents in Illinois. These laws effectively ban job opportunities that might otherwise employ young black men and women in the Chicago area.
There are a number of solutions to tackle the unemployment problem. The first solution is to stop digging a deeper hole with minimum wage hikes and roll back the misguided minimum wage hikes in Chicago and Cook County. Black communities would benefit disproportionately from laws allowing for school choice and education savings accounts, along with changes to the criminal justice system to make it easier for ex-offenders to re-enter the workforce. In addition, all Illinoisans would benefit from stronger economic growth and more business investment, especially in blue-collar lines of work like manufacturing and transportation.
Illinois political leaders should be ashamed of the crisis of black unemployment in the Land of Lincoln. This problem should become a top priority for policy leaders, and a reform agenda should be enacted to reverse the trend of black unemployment in Illinois.