Op-Ed: Slow Economic Gains from Low-Octane Wages

This op-ed appeared in the December 11, 2016 edition of the Bergen Record and other Gannett newspapers.

Ensuring that all workers in New Jersey can afford a decent living is vital to boosting the state’s economy to the benefit of all residents — and a simple way to do so is to increase the minimum wage. About 1 million New Jersey workers currently make poverty wages, forcing many of them to rely on private charity and the increasingly fragile public safety net just to make ends meet. When so many people can’t afford basic daily needs in a consumer-based economy, it creates a big drag on the economy: Everything and everyone suffers.

Apparently, not everyone understands this basic tenet of economics. Opponents of a livable wage continue to assert that the sky will fall and the economy will crumble if New Jersey phases in an increase to a $15 minimum wage over five years. Gov. Chris Christie took this line of attack when he vetoed a bill during the summer that would have boosted wages for one in four New Jersey workers. And the latest wolf-crier is the lieutenant governor, who recently warned that increasing the minimum wage would — horror of horrors — require New Jerseyans to pump their own gas, as if that’s somehow an unacceptable trade-off for ensuring that all of our neighbors are able to live and thrive.

Over the years, opponents of livable wages have stoked fears that increasing the minimum wage would slow the economy and lead to job losses. Never mind that other cities and states that have increased the wage are seeing stronger economies and increased spending; never mind that study after study shows that increasing the minimum wage has far more positive effects than negative ones; never mind that one in four New Jersey workers is living in poverty because he or she isn’t paid enough to afford the most basic daily needs.

After the governor rejected a raise for nearly 1 million workers, legislative leaders promised they would take the issue directly to voters again, as they did in 2013. With a key deadline rapidly approaching, the likelihood of that promise being fulfilled seems less and less likely. Given this stalemate, New Jersey workers who aren’t paid enough to afford the most basic daily needs may have to wait even l­onger —until an administration more interested in boosting working families arrives in Trenton — for a substantial boost to their wages.

Who are these workers? Despite the longstanding myth, they turn out not to be affluent teens working for extra spending money. In fact, 91 percent of these workers are adults. What’s more, 61 percent of them are working full time, about half have graduated from or attended college, and nearly one in three is a parent. Altogether, 21 percent of New Jersey’s children have at least one low-paid working parent.

The simple reality is that poverty and inequality harm all of us. When fewer and fewer people own more and more of the wealth, all of us suffer. If you’re a child whose parents don’t earn enough to reliably provide for your needs, you can’t focus at school. If you’re a parent whose recent college grad can’t afford to move out and build a life, you worry about your child’s future. If you’re a business owner whose customer base has suffered from stagnant wages for decades, it doesn’t matter how good your product is, how good your marketing is, or how nice your store is; there won’t be enough people with enough disposable income to buy your goods or services.

Every time we try to increase the minimum wage, opponents wail and moan that doing so will destroy our economy and bring about a thousand years of darkness. Yet every time we muster the courage to actually increase the wage, jobs are created, the economy grows stronger and the sun continues to shine.

The last time we increased the wage, opponents said with absolute certainty that we would lose 30,000 jobs — instead, we gained 90,000 as low-wage workers were better able to afford their day-to-day needs and infuse the state’s economy with spending that creates jobs and spurs growth. Imagine the effect we’ll see when we actually increase the wage to a level where people can earn a decent living. It’s time to stop accepting the naysayers’ fictional threats.

This past Election Day, voters in Colorado, Maine, Arizona and Washington approved increases in their minimum wages, helping millions of workers. All of these states have a lower cost of living than New Jersey’s and they were still able to understand and appreciate the vital importance that raising the minimum wage would mean for them. So, New Jersey, what are we waiting for?

The coming year will see state Republicans and Democrats argue this very point as they jockey for position in the gubernatorial race. Christie’s political stature is not what it was, but it is unlikely he would sign off on a $15 minimum wage statewide or even for workers at the Port Authority of New York and New Jersey-controlled Newark Liberty International Airport. The latter means a two-tiered wage system between the Port Authority airports in New York and New Jersey. The minimum wage at the two New York major airports is set to rise to $15 an hour.

Meanwhile, our state has been stuck in neutral for far too long as lawmakers have poured money in the pockets of the well-off through lavish tax breaks and sweetheart deals. The only way to get New Jersey going again is to make sure that every worker is able to afford a decent living — it will benefit them, their families and their communities. In other words, it will benefit all of us. Let’s stop listening to those who cry wolf and start using the experiences of other cities and states to do what is sensible and right.

Let’s raise the minimum wage.