Wage Frenzy in New Jersey

Congressman Donald Norcross (D-NJ) and Senate President Steve Sweeney (D-3) have both unveiled plans to raise the minimum wage.

Norcross’ plan focuses on changing minimum wage policy on the federal level, while Sweeney’s plan aims to change New Jersey state policy.

Both plans emphasize incremental minimum wage increases over several years along with creating tax incentives for employers of small businesses.

Sweeney’s bill will compete against Assembly Speaker Vince Prieto’s (D-32) bill which differs from Sweeney’s by increasing the minimum wage to fifteen dollars per hour all at once without a constitutional amendment.

Norcross was quoted by PolitickerNJ to say that his ‘Fair Wage Act of 2016’ would decrease the working poor’s dependence on government assistance. The bills Norcross and Sweeney have authored for their respective jurisdictions share the same rates of increases as well as offering a tax credit of fifty cents on the dollar for small businesses who offer employees the incremented raises.

Alex Law, who is a democratic challenger to Norcross in the upcoming June primaries, rejected Norcross’ proposal.  “This is a horrific bill and not just because the proposed timeline is slower than virtually all other plans. The main reason this is a terrible policy is because it gives enormous tax credits to corporations that sign up “early”. So, essentially, it makes poor tax payers foot the bill for their own raise”, said Law when asked about the new federal proposal.

As for the state level, we see more evidence of not-so-steady relationships within party lines. Sweeney was quoted to criticize Assemblyman Prieto’s proposal, and stated that businesses needed to be courted just like workers. Sweeney expects the support from the 2013 minimum wage increase amendment to carry over through 2017, despite the fact that the 2013 constitutional amendment has had very little impact on the state’s minimum wage.

Sweeney’s 2013 amendment raised the minimum wage by $1 from 2013-2014, and the minimum wage increased by 13 cents to $8.38 per hour due to CPI adjustments in 2015, and will remain at that rate until 2017 or later. New Jersey’s minimum wage did not increase in 2016 due to Sweeney’s 2013 amendment being tied to the Consumer Price Index, which accounts for regional economies. The CPI did not increase in 2016 despite New Jersey’s growing costs of living.

In sum, the previous constitutional route of raising the state’s minimum wage will accomplish a raise of just $1.13 over a 3-year span of the latest amendment being in effect (January 1, 2014- December 31, 2016).

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