NJ’s Minimum Wage Will Stay at $8.38 an Hour in 2016
In 2013, New Jersey voters overwhelmingly approved a ballot question to raise the minimum wage from $7.25 an hour to $8.25 and tie future increases to the Consumer Price Index.
In 2015, the cost of living increase from the previous year drove the minimum wage up to $8.38 an hour. The CPI actually dipped 0.3 percent in 2015 which means there will be no automatic, constitutionally mandated minimum wage hike in 2016.
“The key here is certainty for businesses who are doing their planning and have been doing their planning for 2016,” said Michele Siekerka, New Jersey Business and Industry Assoc. president and CEO. “The biggest concern with the mandated minimum wage tied to the CPI is that you don’t have that predictability as you’re planning for the future.”
New Jersey Policy Perspective, a liberal think tank based in Trenton estimated that the hourly wage needed for a single adult worker to afford basic needs in New Jersey is at least $13.78. The group claimed that was a conservative estimate.
"New Jerseyans who work hard every day shouldn't have to live in poverty," said Brandon McKoy, NJPP policy analyst in an emailed statement. "All hard-working men and women should be paid enough to be able to put food on the table, a roof over their heads and clothes on their back. Yet this is not possible for many low-wage workers in the Garden State. Lawmakers must do better for these working families."
Having the minimum wage remain at $8.38 an hour bodes well for Garden State businesses and the state’s economy according to Siekerka.
“That’s always our concern, to keep New Jersey competitive and competition among wages is one of those key items that employers look toward” she said.
According to NJPP calculations, a New Jerseyan working at minimum wage needs to work at least 66 hours a week just to avoid destitution and earn enough just to afford basic needs. If that person also had a spouse and two young children, the adults in the household would need to work at least 146 hours a week at minimum wage just to get by.
Businesses might increases wages overall if New Jersey’s economy was doing better, but it’s actually lagging behind surrounding states said Assemblywoman Sheila Oliver (D-East Orange) who helped spearhead the charge to get the minimum wage question on the ballot. She didn’t think the legislature needs to revisit the minimum wage at this point.
“I don’t think it’s time to do that yet. I think we must keep an eye on revenue growth,” said Oliver. “I think when we grow our revenue and we come up with new ways of New Jersey identifying new revenues that will then benefit employers.”