New Jersey is on pace to become the fourth state in the nation to phase in a $15 hourly minimum wage, but a bill that moves too slow and leaves too many workers behind would diminish the positive impacts on the state's economy.
New Jersey’s minimum wage of $8.60 ranks as the fifth-lowest in the country when taking the cost of living into account. We suffer from a stubbornly high poverty rate of 10 percent despite the state registering an unemployment rate of just 4.2 percent. Wages are not growing as quickly as experts expected, let alone as fast as workers need them to. Since large parts of the state’s workforce have struggled to afford day-to-day needs — depriving our business community of would-be customers — it should come as no surprise to anyone that our economy continues to grow at a snail’s pace.
Nowadays, even business groups that would typically oppose any increase in the wage grudgingly acknowledge that the current level is too low for a worker to afford the most basic of needs. While many outside observers would consider that to be a positive sign for the prospects of the eventual bill, opponents are working hard behind the scenes to prolong the phase-in target date beyond 2023, leave the tipped wage at $2.13 per hour and exempt entire sectors of the workforce from the change.
Of course, all of this is done in the name of “protecting business,” but the simple fact of the matter is cities and states across the country that have embraced strong $15 minimum wage legislation have seen huge positive impacts for their economies. New Jersey desperately needs its low-wage workers to participate more in its economy, and it should do its best to implement a strong bill that leaves no worker behind.
Research shows that gradually increasing New Jersey’s minimum wage to $15 by 2023 would boost wages for 1.2 million workers and pump $4.5 billion into the state’s economy. Extending the phase-in beyond 2023 or limiting the sectors of workers included in the legislation would significantly and unnecessarily dampen the size of that impact.
Carving out youth workers would be not only be callous, but incredibly hypocritical following the state implementing an equal pay law. It makes no sense to declare that pay discrimination by gender is unacceptable but discriminating against workers born after a certain date is totally fine. Either work is work and must be valued equally no matter who does it, or it isn’t. You can’t have it both ways. Besides, we know that youth workers, particularly those from low-income families, contribute significantly to their household income and are saving for the ever-increasing costs of college. They’re as deserving of a $15 wage as anyone else.
The same goes for workers in the agricultural sector and tipped industries. Historically, New Jersey has never shut out farmworkers from a minimum wage increase before. To do so now under a progressive governor’s administration would be a terrible mistake, particularly since these workers are among the most vulnerable in the state. If opponents’ chief concern is “keeping the garden in the Garden State,” there are other ways to help farms afford their business costs like well-targeted tax credits and properly sized subsidies. Allowing them to skimp on labor costs is entirely unnecessary and has a domino effect that drags on the rest of the economy.
For tipped workers, New Jersey already has one of the largest gaps in the nation between its tipped and minimum wages at $6.47. To increase the minimum wage to $15 without raising the tipped wage would only extend that gap and make wage theft more likely in industries already rife with it. Getting rid of the tipped wage altogether is entirely possible. Not only is it shown to significantly reduce instances of sexual harassment for female workers, but it doesn’t have the negative impact on the food industry that many claim it does. The entire West Coast has done away with a tipped wage and their food landscapes are just as diverse and vibrant as anywhere else in the nation.
At the end of the day, it’s important to remember that increasing the minimum wage is about a whole lot more than improving the economy. It’s about reducing poverty, increasing the health and welfare of low-wage workers and giving every single New Jerseyan the chance to live full and productive lives where they can contribute not just economically but socially and civically.
So let’s get on with the business of making New Jersey’s economy stronger for everyone, no matter who they are or where they work. Let’s raise the wage to $15 for all New Jersey workers.
Brandon McKoy is director of government and public affairs for New Jersey Policy Perspective.