Lawmakers took the first step on a bill encouraging employers to hire more workers under 18 years of age, a move they argue could mitigate the effect that the minimum wage may have on businesses as it rises up to $15 an hour.
That measure, Senate Bill 718, would create an incentive program capped at $10 million a year to hire workers under the age of 18. It comes nearly a year after the passage of the minimum wage increase, which was bumped to $11 an hour in January and will reach $15 an hour by 2024. S718’s purpose would be to encourage the hiring of adolescent workers, who might otherwise be the first to lose their jobs at small-and-medium-sized businesses as a result of the increase. It was approved Thursday morning by the Senate Labor Committee.
“[H]iring and training young, often transient, high school labor can be costly for businesses, and we don’t want the increase in minimum wage to deter them from giving our youth valuable opportunities,” the bill’s main sponsor Sen. Dawn Addiego, D-8th District, said in a Thursday afternoon statement
Part of the last year’s minimum wage bill calls for a similar $10 million tax credit program to encourage employers to hire workers with disabilities. Senate President Stephen Sweeney, D-3rd District, said in 2019 that the point of that incentive was to offer a cushion for those workers, who might be the first to be let go if businesses look to cut costs following the wage increase.
Under both the disabled and the adolescent worker incentive programs, if a business has to pay the employee more in the current year than it did the prior year because of the wage increase, that employer could count the pay difference as a tax credit against the income or corporate business taxes the employer already owes.
“One of the unintended consequences of increasing the minimum wage so dramatically is an expected decrease in the employment of high school students,” Michele Siekerka, president and chief executive officer of the New Jersey Business & Industry Association, said Thursday in a statement.
“Without this legislation, many young workers will have challenges attaining that after-school or summer-vacation work experience that has helped send so many of us on our way in the workforce.”
Business groups had been pushing for other bills to help alleviate the effects they may feel as a result of the wage increase. One bill would have called for the state to suspend wage increase mandates in the event of an economic downtown, but the measure was pulled soon after its introduction in November, after it met intense opposition from progressives and labor groups.
Sen. Vin Gopal, D-11th District, who sponsored that measure, also pulled another bill that would have created a task force to study the effect the minimum wage increase has on businesses including the ability to hire new workers, whether they needed to cut hours or lay off workers to make ends meet, and whether they switched to automation.
Editor’s note: This story was updated at 3:16 p.m. EST on Feb. 13, 2020 to include comment from Sen. Dawn Addiego.