Illinois Woes Continue to be Indiana’s Gain

Indiana has had more than a little success in attracting businesses to head immeditely east — from Illinois to the Hoosier state. A Rockport Register Star political reporter says the numbers show just how bad the situation is in his home state.

The Land of Lincoln is a tough place to do business to be sure.

For example, Office Depot has been capturing plenty of headlines. The company recently merged with OfficeMax, and its executives were pondering whether to use OfficeMax’s Naperville headquarters or Office Depot’s Boca Raton, Fla., site.

The Sunshine State won out. It’s not hard to figure out why.

Just consider:

  • Illinois has a corporate tax rate of 9.5 percent (7 percent income, 2.5 percent personal property replacement tax) while Florida has a 5.5 percent corporate tax rate.
  • Illinois has a personal tax rate of 5 percent while Florida has none.
  • For every $100 worth of payroll, Illinois employers pay an average of $2.81 for workers’ compensation insurance, compared to $1.84 in Florida.
  • Illinois’ minimum wage is $8.25 per hour, compared to $7.79 in Florida.

You see, it’s not just Florida that Illinois has trouble competing against. It’s just about every state that has a leg up on the Land of Lincoln.

Just consider:

  • A study conducted by the state of Oregon found that Illinois has the fourth-highest workers’ compensation rates in the nation.
  • Illinois also has the fourth-highest minimum wage in the nation.
  • Illinois’ corporate tax rates rank, you guessed it, the fourth-highest in the nation.
  • Given these numbers, it’s little wonder that Illinois has the 11th-lowest rate of entrepreneurship in the U.S., according to the Kauffman Entrepreneurial Index.

And small businesses are the major job generators in the economy.

According to the U.S. Small Business Administration, small firms employ just more than half of the private sector workforce and created nearly two-thirds of nation’s net new jobs over the past 15 years. Please keep in mind, every big company started out small.


Wage Hike Bad News for Unskilled Workers

Remember the past battles over minimum wage increases? The most recent was two years ago when Congress passed a three-part pay hike. The final installment went into effect last Friday, raising the minimum wage to $7.25.

It makes some sense on the surface. It makes none in reality. We’ll let Heritage Foundation expert James Sherk explain. Read his entire column here.

Unemployment will not fall until businesses resume investing in new enterprises. Ask yourself: Will raising the minimum wage encourage or discourage such investing? Will it encourage or discourage entrepreneurs from starting new small businesses? Raising the minimum wage now will help keep unemployment among unskilled workers high.

Ready for the Minimum Wage Increase in July?

In July, the minimum wage will change from $6.55 to $7.25 according to federal law (as part of the three-year, stair step increase implemented in 2007). You need to make sure your company’s mandatory employment postings include those changes. Ours do.

Here are the changes we made when we published new poster sets in January:

  • FMLA notice (updated in January)
  • Indiana Minimum Wage notice (our sets feature updated overtime requirements that will still be in compliance when minimum wage increases in July)
  • Federal USERRA notice (updated October 2008)
  • Federal Equal Employment Opportunity notice (updated August 2008)
  • Poster sets are $45 each, and Indiana Chamber members receive a 25% discount.

To place your order, call us at (800) 824-6875 or visit our web site.

Please mention POSTBLOG509 when ordering.