On Minimum Wage The Legislature Has The Upper Hand

Governor Christie appears to be amenable to an increase in the minimum wage. However, he opposes indexing the hourly rate to the Consumer Price Index (CPI). Thus he will likely veto the legislature’s bill which includes indexing. The next step will be to put the matter to a public ballot.

If the legislature were to annually review and adjust the minimum wage level there would not be a problem. However, historically employees have had to wait for years for an increase which does not even make up for the purchasing power lost. The last time New Jersey’s minimum wage was increased was July 2009, and it went up only 1.4% from $7.15 to $7.25 per hour. The CPI for our region shows that the cost of goods and services has risen 6.5% since then.

For a minimum wage employee at today’s rate of $7.25 per hour who is able to work 8 hours per day, 5 days per week and 52 weeks per year his or her annual income is a paltry $15,080. At the proposed new wage level of $8.50 his or her annual income would be $17,680. However, many minimum wage employees are paid for less than 40 hours per week and receive no money if they are absent, sick or on vacation. The poverty level for a family of 4 in New Jersey is an annual income of $22,314 or less. No wonder the poverty rate is growing in N.J.’s working-class towns.

There has been too much bickering in the legislature over this bill. It was passed by the Senate this week, and the Assembly will quickly pass it as well. Assembly Speaker Sheila Oliver said, “Hopefully, the governor will sign this bill as-is, but if he does not, then we’ll quickly take stock and weigh our next step, including asking the people of New Jersey to decide this important matter.” Following the presumed veto, the legislature should move to put the matter to the ballot. There is poll information suggesting the public would be in support of both raising and indexing the wage level. There would be a delay in implementing an increase, but the result of indexing the minimum wage to the CPI would be a long-term benefit and worth the wait.

Comment (1)

  1. deciminyan

    Bill – you say “If the legislature were to annually review and adjust the minimum wage level there would not be a problem.” With the present legislature, that’s true. But I fear that if the Republicans take over one or both houses (a possibility in a 2013 Christie landslide if the Democrats put up a weak candidate), then you can forget about common-sense increases to match the cost of living.


Leave a Comment

Your email address will not be published. Required fields are marked *