NJBIZ STAFF//March 6, 2016//
What would the business landscape in New Jersey look like with a $15-an-hour minimum wage? Maybe the better question would be: What would New Jersey look like if every time the Legislature wanted something it couldn’t have, it resorted to amending the state constitution to get it?
The legislative bickering over whether to pass a law raising the wage is a purely academic exercise, since Gov. Chris Christie has made it clear he’ll veto any such measure and Republicans in the Legislature have made it clear they still will not challenge him. The constitutional run-around that Democrats are increasingly resorting to is, sadly, becoming standard operating procedure as lawmakers look to break Christie’s veto blockade.
So consider this a preview of a ballot-box measure. We don’t support such a drastic increase in the minimum wage.
It’s time for politicians to address the biggest cause of income issues: the state’s high-tax environment.
This is not a knee-jerk reaction to the fact that this essentially amounts to a tax on business owners. When the Affordable Care Act was being written, we knew there would be costs and administrative pain to businesses, but they were countered by the fact it appeared to be an effort to address the significant problems with the health care system in the United States. (We’ll leave it to you to decide if it’s helped.) Raising the minimum wage, on the other hand, will certainly put more money in the pockets of low-wage workers, but businesses will have to absorb that cost the only way they can — higher prices for goods and services. Eventually, those costs will trickle down to harm the people such an increase is designed to assist.
If the minimum wage nearly doubles — from $8.38 to $15 an hour in the plan put forward by Assembly Speaker Vincent Prieto — the cost of living will follow suit. The further penalty is that committing more resources to the lowest-skilled workers limits the ability of businesses to adequately compensate their top performers, which could create additional — and costly — turnover for leaders to manage.
There’s certainly an argument to be made for an increase to the wage for people struggling to be able to afford a New Jersey address. But, in general, this kind of thinking tends to be the lazy answer that doesn’t address the underlying problem of a high-tax environment that prices so many people out of the state. We’d much rather see Prieto and Senate President Steve Sweeney work with the governor to develop sustainable tax cuts, as opposed to again dumping the load on the shoulders of business owners.