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Tom Bracken gets it. Raising the minimum wage always will be a winning point for Gov. Phil Murphy with many in the electorate. That’s why he didn’t put too much stock in the governor’s comments Thursday night — when he suggested making the minimum wage $18 an hour or even $20.
This is not the house-on-fire moment of 2019, when the governor signed a bill to dramatically increase the minimum wage — to $15 — which was being called an economic killer to small business in the state.
“I get it; as a politician, suggesting that people should make more money always is a winning play,” he said.
Bracken, the head of the New Jersey Chamber of Commerce, also said he’s well aware of the wage gap that exists in the state — and how working-class people are struggling. He’s just not sure if this is the right play.
“Sure, some people will get more money, but is it really solving the problem?” he asked. “Will it just keep prices going up — hurting the people this is intended to help?”
Murphy, speaking on a radio call-in show, discussed the fact that the minimum wage will finally surpass $15, moving to $15.13 on Jan. 1.
“I wonder whether or not we shouldn’t be taking this higher,” he said. “That’s something I’m open to.”
Under the law that Murphy signed, the state’s minimum wage will continue to increase each year based on any increase in the Consumer Price Index, which measures inflation by tracking the changes in prices consumers pay for certain goods.
Is that enough? New Jersey, after all is just the fifth state in the country to reach that $15 mark (joining New York, Massachusetts, California and Washington).
Michelle Siekerka, the head of the New Jersey Business & Industry Association, said the market has been acting faster than the minimum wage.
“The truth of the matter is that more entry-level positions exceeded the $1 dollar increase per year over the past five years, especially given the aftermath of COVID and workplace demands,” she said.
Siekerka pointed to the NJBIA’s annual Business Outlook Survey, which said 34% of businesses increased pay for employees by 5% or more. Despite the fact only that only 1 in 3 respondents said they will make money in 2023.
Siekerka points to the wage law as it was written.
“The state constitution specifies that minimum wage be determined by the CPI. We shouldn’t be dismissing that,” she said. “It might be better to take a pause to analyze inflation and the free market, rather than just setting a number.”
Bracken doesn’t have the answer. But, he said the business community continually tells him that its two biggest concerns right now are inflation and the worker shortage.
That worker shortage is the reason many already are paying over minimum wage now.
Bracken, as he always preaches, says the state will be better for everyone if there is a push to make doing business better — which will result in more jobs and more taxes paid.
“Especially now,” he said. “We have a fiscal cliff coming. We need to make sure we are ready for it. Doing something that could cause more inflation is not the answer.”
At a vulnerable time, Siekerka said.
“We don’t know which way the economy is going, and there are still businesses that are still very much vulnerable,” she said. “Most of our employers have a keen awareness to the economy and their own bottom lines. They know what they can afford and what they can’t.
“Let the free market do its work.”
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