NJ Top News 6/1 - NJ Worker Shortage Will Trigger Higher Costs

Gov. Phil Murphy is suggesting the on-going worker shortage in New Jersey is a good thing.

Long a supporter of increasing the minimum wage to $15 per hour, Murphy thinks the pandemic will make that happen sooner and might increase wages even more. With the enhanced federal unemployment benefit of $300 per week, workers who make less than $15 per hour make more staying home then going back to work. The disparity has hit the hospitality sector particularly hard. Some shore businesses say they have increased their starting salaries to as high as $16 per hour, and still can't hire enough workers.

Murphy, however dismissed talk of enhanced unemployment benefits being a disincentive to work. As he was preparing to march in a Memorial Day Parade in Bergenfield on Monday, the governor said lingering COVID-19 fears have left many workers "scared" to return to work. He also blamed a lack of daycare and school concerns for the worker shortage. Yet at the same time, Murphy suggested the worker shortage is good thing with free market forces and the demand for workers forcing businesses to up wages, "It may be that (business owners) will have to pay them more."

Gov. Murphy is also aware consumers will be forced to pay more as businesses pass their increased labor costs to customers, and is unconcerned. “My sense is that's probably one way that folks will get around this,” he said. “And my guess is in fairness they'll probably pass that on, so the burger is going to be an extra 50 cents or 75 cents, whatever it might be.”

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Several business leaders during a recent town hall sponsored by the New Jersey Business and Industry Association said workers collecting unemployment had indicated they would return to work if they could be paid in cash so they could continue to collect benefits. Almost half of all states have already canceled the extra $300 per week federal unemployment benefit or have made plans to phase it out. Arizona, Montana, New Hampshire and Oklahoma are offering incentives to return to work. Murphy has dismissed talk of canceling the federal benefits and has refused to enforce the rule that the unemployed certify they are actively looking for work.

Michele Siekerka, the president and CEO of NJBIA, said people who genuinely cannot return to work should have the safety net of unemployment insurance, but for those who are able to return to the workforce, unemployment should no longer be an option. “There are too many examples of people who are unfortunately taking advantage of the system and we need accountability,” she said. “We need a system that is balanced right now that helps the employer while protecting the employees who need the benefit.”

More NJ Top News:

Rutgers testing COVID vaccine on infants as young as 6 months old.
NJ makes it easier for undocumented residents to get a drivers license.
Should NJ sports venues require fans to be vaccinated to attend games?
10 dogs rescued running loose in North Jersey. Where did they come from?
NJ has among the highest worker burnout rates.

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