TRENTON – The state’s leading business groups said some 31,000 jobs would be lost over a four-year period if the minimum wage increase goes forward and continues to go up each year to be consistent with the rate of inflation.
Voters in November will get to vote on raising the minimum wage from $7.25 to $8.25, and increase it each year based on the rate of inflation.
National Federation of Independent Businesses said in its study that some 31,797 jobs would be lost in he next 10 years if inflation increases by 4 percent each year. If inflation increased 2 percent each year over the next 10 years, some 22,695 jobs would be lost by 2023.
But job loss over a long period of time is not the only effect. The business group leaders predicted a so-called escalator effect of other, slightly-higher wage earners asking for wage increaes, fewer hours per employee, fewer new hires, and higher prices for products
“Hiking the minimum wage in a struggling economy could cripple businesses,” said NFIB state director Laurie Ehlbeck.
Tom Bracken of the state Chamber of Commerce described the minimum wage legislation as “insane,” saying it will make the state less competitve.
“This is a bad piece of legislation,” he said. “This makes no sense.”
Jerry Cantrell of Common Sense Institute dismissed the minimum wage hike bill as “feel-good legislation.”
Even if inflation remained at 0 percent each year until 2023, NFIB estimates that there’d be 13,679 fewer jobs.
Democrats have argued a minimum wage hike is necessary in order for working families to be able to afford increasing costs in utilities. and to provide a slightly improved quality of life.
Senate President Steve Sweeney said in October about hiking the minimum wage,
“Instead of getting soup, they might get a hamburger.”
The federal Bureau of Labor Statistics estimates that some 1.77 million workers are hourly wage earners, but only 44,250 currently earn the minimum wage. A large portion of the minimum wage earners are teens between ages 16 and 19, BLS said.