TRENTON – The New Jersey Business and Industry Association, along with Senate Minority Leader Tom Kean, (R-21), of Westfield, came out against Senate President Steve Sweeney’s proposal to increase the minimum wage, saying it will hurt the state’s economy.
“Rigid automatic increases in the minimum wage will make it almost impossible for the state to respond flexibly to future economic conditions,” NJBIA President Phil Kirschner said in a statement.
“Raising the minimum wage 14 percent in a weak economy is a bad idea that ignores the fact that most businesses’ sales are up only 2 percent and employers do not have more revenue to pay for state-mandated raises.
“Enshrining a wage increase and automatic annual increases in a constitutional amendment is a very bad idea,” Kirschner added. “Even those who support an increase in the minimum wage should recognize that messing with the Constitution is not the way to do it. People elect the Legislature to deal with these issues. Mandating a wage increase is not what our Constitution is there for, and frustration with achieving a policy goal does not change that.”
Sweeney has announced he will propose a constitutional amendment increasing the minimum wage and tying future increases to the Consumer Price Index.
A state-mandated wage increase will hurt the economy because businesses will be forced to reduce hours and jobs in order to pay for it, the NJBIA said. Furthermore, the public will have to pay more for goods and services and businesses will have less money to spend on goods and services they need to operate.
Kean also took issue with the idea of changing the state Constitution to push through a proposal that he said should be approved by the Legislature instead.
“The only one person playing politics with the minimum wage is the Senate President, who without passing a bill or trying to negotiate a solution with anyone is trying to distort the purpose of the state Constitution to accomplish his party’s goals,” Kean said in a statement.
“Writing the minimum wage into the New Jersey Constitution and setting it on autopilot, with yearly increases that are guaranteed regardless of the economic situation, is cold, calculated politics designed to satisfy Democrats’ political interests rather than the best interests of the state. By refusing to discuss this with anyone who disagrees with their point of view, Democrats are pitting labor against business and dividing our state.
Kean also referred to previous decades and the economic malaise that resulted from inflation.
“Anyone who remembers the ‘70s can see why this is a horrendous idea: prices rose, but the economy was stagnant. Inflation doesn’t automatically mean that employers can afford to pay workers more. Economic circumstances and needs change, but the state Constitution is for all intents and purposes permanent and difficult to change even in an emergency.”