A Dire Warning About the $15 Minimum Wage in NJ
A report from the nonprofit Employment Policies Institute suggests New Jersey could lose roughly 32,000 minimum wage jobs if the state raises the minimum to $15 an hour.
Two economists, David MacPherson, of Trinity University, and William Even, of Miami University, examined the effects should the Garden Sate hike the minimum to $15.
Institute Managing Director Michael Saltsman says early research from San Francisco and Seattle is not encouraging, and shows thousands of minimum wage job losses.
"The businesses that tend to be impacted by a higher minimum wage are low margin businesses," he said.
"They are only keeping a few cents in profit on each sales dollar. And so when the minimum wage goes up, if they cannot pass that cost on to customers through higher prices, they have got to make one of a few difficult choices."
Saltsman cites another example, nearby New York state.
"As the minimum wage has risen there, you have had a number of employers who have cut the number of people on any given shift to reduce the labor costs."
The Institute also warns that almost a third of those minimum wage job losses in Jersey could be for people ages 16 to 19.
Saltzman adds: "One option that has received some bipartisan support is a policy called, the Earned Income Tax Credit. Basically, it was a way to kind of boost wages, and it works a lot like a minimum wage increase, but it operates through the tax code instead of a mandate on employers.
"We did some calculations and found that because of the benefits of the Earned Income Tax Credit that already exists in New Jersey, if you are a single parent with two children in the state, your minimum wage is already above $12.25. So folks are really taken care of by the current policy set up."
Joe Cutter is the afternoon news anchor on New jersey 101.5