The Greenlining Blog | Connecting Communities, Issues, Policy & People

Estate Tax Elimination Would Put New Jersey Out of Step with Most of Our Neighbors

Posted on June 21, 2016October 11, 2020 by Sheila Reynertson

As legislators from both sides of the aisle have charged ahead with an extreme plan to completely eliminate the estate tax, much has been made of how New Jersey – with the nation’s lowest threshold – is an “outlier” state.

By repealing the 82-year-old tax, New Jersey lawmakers wouldn’t only be providing a spectacular tax break for heirs of multimillion dollar estates while depriving the state of $550 million dollars every year at a time when the state’s already can’t meet its obligations. They’d also be putting New Jersey out of step with nearby wealthy states, which understand the value of levying a tax on fortunes that the vast majority of Americans can only dream of.

Yet the governor, some legislative leaders and business lobbyists are adamant that the estate tax has to go, asserting that wealthy residents leave New Jersey to avoid the tax and middle-class heirs are unfairly burdened by its low threshold.

Putting aside whether these stories are accurate and representative, (they’re not), the rush to completely wipe the estate tax clean off the books at a time when New Jersey relies on its revenue more than ever is hardly a sensible trade-off. Instead of raising the threshold to help relieve “smaller estates,” lawmakers seem determined to give away the farm – making New Jersey an outlier in the most damaging way.

Tying Transportation Funding Fix to Estate Tax Elimination is Reckless

Posted on June 10, 2016October 11, 2020 by Gordon MacInnes

This afternoon the Senate and Assembly Democrats’ both released frameworks of plans to fix New Jersey’s Transportation Trust Fund that included the outright elimination of the state’s estate tax.

A long-term plan to replenish the funding for New Jersey’s roads, bridges and mass transit is overdue and essential – but tying such a welcomed plan to an outright elimination of the state’s estate tax is financially reckless and endangers the state’s future. It has nothing to do with so-called ‘tax fairness.’

By moving to eliminate the estate tax, New Jersey’s leaders are once again severely diminishing the state’s ability to invest in more affordable higher education, cleaner air or a stronger safety net for those who have fallen on hard times. At a time when New Jersey can’t even meet its constitutional and moral obligations, let alone make investments critical to our future, our legislative leaders are choosing to dig our financial hole even deeper.

And for what? Eliminating the estate tax is no boon to the middle class, despite proponents’ claims. While 9 million of us will pay higher gas taxes, our legislative leaders propose to bail out around 4,000 of New Jersey’s wealthiest heirs each year. Eliminating the tax will help the largest estates the most, with those inheriting assets of more than $5.34 million who will see an average tax break of $1.3 million. The cost to a New Jersey that cannot pay its current and future bills will be more than a half-billion dollars every year.

Reforming New Jersey’s Subsidy Law: Four Fixes Part of New Legislative Proposal

Posted on June 2, 2016October 11, 2020 by Jon Whiten

Update, June 3: An amended version of this bill – without the provision on inverted corporations – cleared committee yesterday.

This written testimony, on A-328, will be delivered to members of the Assembly Commerce and Economic Development Committee today.

Members of the committee, thank you for the opportunity to submit this written testimony outlining New Jersey Policy Perspective’s strong support of the modest, common-sense reforms put forth in A-328.

This legislation brings four important fixes to New Jersey’s tax subsidy programs:

1. Restoring Financial Integrity to the ‘Net Benefits Test’

As you are aware, the Economic Opportunity Act of 2013 made sweeping changes to New Jersey’s tax subsidy programs. While some of those changes were positive, on the whole the legislation greatly expanded the size and scope of these offerings while eliminating several key financial protections for taxpayers and the State of New Jersey. A-328 represents a partial course correction, in that it eliminates some of the most egregious taxpayer risk.

It does so by restoring financial integrity to what’s known as the “net benefits test.” This is the formula the state uses to estimate the economic benefits of any proposed tax break, using the number of proposed jobs, their promised wages and other factors. When designed properly, this is a basic taxpayer protection that ensures the state isn’t losing money on an incentive deal. Problem is, in many cases under the EOA, the test offers little or no taxpayer protection.

Before 2013, to be approved for a tax break, a Grow New Jersey project had to deliver a benefit to the state of at least 110 percent – in other words, 10 percent more than the dollar value of the subsidy – over the same period (usually 15 years) that the company was committed to keeping the jobs in-state. If the corporation didn’t meet those promised obligations, it would receive less of a tax break, or none at all.

But now, a Grow New Jersey project in Camden need only deliver a 100 percent benefit – in other words, break even – over 35 years. And the corporation is obligated to deliver the proposed jobs and economic activity for, at most, only 15 years. After that, it can move, slash its workforce, cut pay across the board, or threaten to move in order to receive yet another tax break – and the state would have no recourse to claw back any of the tax credits that had already been claimed.

As a result, when taken together, the 17 Grow New Jersey projects approved for Camden so far actually come with a risk to the state of $273 million, according to the Economic Development Authority’s own numbers, which NJPP has obtained through the Open Public Records Act. That stands in stark contrast to the “net benefit” of $529 million that is officially on the books and created by this implausible and unrealistic economic estimating formula.

And Camden isn’t the only area where a corporation could receive an incredibly lopsided benefit. In the four other cities the state considers to be most distressed – Atlantic City, Passaic, Paterson and Trenton – a project’s benefits must equal 110 percent of the tax break but are estimated over 30 years, which still creates a significant imbalance between taxpayer and corporate interests.

A-328 corrects this imbalance by ensuring that the net benefits test corresponds to the number of years the corporation is committed by statute to stay in the state. This would be a big step towards good government and financial responsibility, and a return to the common-sense practices employed before extending tax breaks in the past.

2. Ensuring Fair Wages

A key positive provision of the Economic Opportunity Act of 2013 bill ensured that custodial, security and building maintenance workers on any project or development that received tax credits under Grow New Jersey or the ERG program be paid no less than the prevailing wage for that industry or sector.

Unfortunately, this was the only provision of the original legislation that the governor conditionally vetoed, and it never became a reality. As a result, the State of the New Jersey is at risk of subsidizing unlivable wages related to many of these projects. A-328 would add this provision back to the legislation, and ensure that workers involved in all aspects of these subsidized projects are paid fair wages.

3. Preventing Extra Rewards for Some Known Federal Tax Dodgers

This legislation would also bar any so-called “inverted” corporation from being able to receive state tax breaks. Inversions are when a larger U.S. corporation merges with a smaller foreign company to avoid U.S. taxes. This practice works wonders for corporate bottom lines but harmfully erodes the federal tax base and limits the government’s ability to invest in the public goods that grow the nation’s economy. Basically, company management stays put, taking advantage of America’s highly educated workforce, patent protections and transportation infrastructure – without helping to pay for it.

While this is largely a federal tax issue, and while recent U.S. Treasury rules may start to limit the flow of new inversions, here’s no reason New Jersey policymakers should reward corporations dodging federal taxes with additional tax breaks.

Barring them from doing so would prevent a double whammy for New Jersey: a company’s federal tax avoidance produces a lower state tax base, which is again reduced by generous tax breaks handed out by the Economic Development Authority. It would also revoke already granted incentives to companies if they choose to invert while receiving the state subsidy, and force those companies to return their incentive to New Jersey’s taxpayers.

While this policy change can’t change federal tax policy on inversions, it is a small but important step to protect New Jersey’s tax base and limit the state’s rewards for harmful corporate behavior.

4. Ensuring Comprehensive Review & Analysis

Last, but certainly not least, this legislation would ensure that the state provide essential information on the outcomes of these tax breaks – which total over $4 billion and growing in just two and a half years since the enactment of the Economic Opportunity Act – to enable a fair and comprehensive evaluation of these programs’ efficacy. While the EDA has taken some positive steps in this direction, including contracting with the Bloustein School at Rutgers University to analyze these subsidy programs, more certainly could be done. At the very least, A-328 would codify the requirement that such an analysis be done.

In conclusion, this legislation represents a smart, modest step towards more financial responsibility, better outcomes for all workers and greater taxpayer protection. We applaud it as a first step, but suggest that much more should be done, including restoring spending caps to Grow New Jersey, lessening the focus on shifting jobs within the state and disallowing corporations from selling these tax credits on secondary financial markets. NJPP is available and willing to partner with any legislator who’d like to discuss further reforms. Thank you.

Latest BEIP Proposal is Proof New Jersey’s Surge in Corporate Tax Subsidies is Unaffordable

Posted on May 19, 2016October 11, 2020 by Jon Whiten

Yesterday the Christie administration proposed to “slow the implementation schedule of the conversion of BEIP grants into tax credits” as part of its plan to close a looming 2017 budget gap. This is just more proof that New Jersey’s surge in business tax subsidies is simply unaffordable.

This proposal – combined with projections released last week by the EDA showing a growing budget hole from BEIP and other subsidy programs – clearly shows that policymakers need to rethink this flawed economic development strategy, which favors short-term thinking over long-term prosperity.

When the state couldn’t afford to keep its commitments to these businesses, it converted the annual payments from budget line items to future tax credits, which kicked the can down the road and made the dollars lost to these subsidies harder to see.

Now the state can’t even afford the anticipated first-year loss from the tax credits, and is looking at kicking the can even further down the road.

If policymakers want to offer such lucrative tax breaks to corporations, they should make the hard choices and find the money to pay for them – not merely push the costs off to future policymakers, who will be forced to contend with an ever-shrinking pool of revenues to pay for pressing state needs.

No, New Jersey’s Poorest Aren’t Offered a ‘Very Large’ Package of Benefits

Posted on May 18, 2016October 11, 2020 by Raymond Castro

In defending basic assistance to New Jersey’s poorest families in the face of questions about increased deep-child poverty, Department of Human Services Commissioner Elizabeth Connolly told the Assembly Budget Committee this week that these families are offered a ”very large” package of benefits from other programs.

The committee’s questions about that basic assistance provided through Work First NJ (the state’s name for TANF, or Temporary Assistance for Needy Families) came on the heels of NJPP’s groundbreaking February report, which found that:

• Assistance has not increased in 29 years

• A family of three receives just $424 a month – an amount that now represents just 25 percent of the federal poverty level, contrasted with the 61 percent it represented in 1981

• New Jersey provides the lowest benefit in the Northeast, and the 40th lowest in the nation when housing costs are considered, falling behind even Kentucky

• This erosion in basic assistance has contributed to an alarming increase in deep child poverty

Unfortunately for these poor children, the commissioner’s defense is simply not supported by the facts.

The biggest surprise was that she inferred that housing assistance is part of that package. In fact, only 2,937 New Jersey families and individuals that relied on WorkFirst NJ as their main source of income received public housing and Section 8 last year, according to data from HUD. That’s just 6 percent of all WorkFirst NJ households. What’s more, despite its very high housing costs, New Jersey does not provide a housing allowance as part of its basic assistance, as New York and some other states do.

The families receiving housing assistance are the lucky ones because the waiting lists for public housing have reportedly gotten so long that applications are no longer being taken anymore. So, most families aren’t offered any housing assistance and must rely entirely on their $424 a month cash assistance to pay for housing (in addition to clothes, school supplies, and some other necessities).

On average, based on HUD’s Fair Market Rate, that’s only about a third of the rent for a modest two bedroom apartment in New Jersey assuming that every penny of that assistance went to housing. That explains why so many WorkFirst families get evicted and placed in shelters at far greater public expense.

The commissioner also included child care in the package of services these families are offered. But less than 9 percent of all WorkFirst NJ families receive child care, according to the department’s own statistics. This is distressing, since it is well known that quality child care is vital to giving children in poverty a fair shot. The reason so few WorkFirst NJ families receive child care is that the state only provides child care when the parent is in a working or in job training. And even this paltry benefit is diminishing. In the last three years alone, the number of children in child care has been reduced by about a third, resulting in a $11 million decrease in state funds for this vital service.

The other major benefit included in WorkFirst NJ families’ “very large” package of benefits is nutritional assistance through the Supplemental Nutrition Assistance Program (SNAP) program, also called food stamps. But that program has its own limitations. While most WorkFirst NJ families receive this benefit, it only pays for one basic need (food), and assistance is far less than it should be. The average SNAP benefit per person for each meal is only $1.32, which is one of the main reasons many families run out of this assistance towards the end of the month and use whatever’s left from their cash assistance to put food on the table.

Even with SNAP benefits added to the mix, WorkFirst NJ families continue to live in dire poverty, as this boosts total assistance to just 55 percent of the federal poverty level, an inadequate measure of true poverty in high-cost states like New Jersey. For example, when the U.S. Census took into account a state’s cost of living and all other benefits a family receives, including SNAP, they found that the number of families living below the poverty level actually increased significantly in New Jersey, unlike in most states.

The commissioner also mentioned child support. Only about a quarter of all WorkFirst NJ families receive child support, according to the federal government – and the state keeps most of the money to offset the cost of the cash assistance the family receives.

Despite being wrong about this so-called “very large” package of benefits for New Jersey’s poorest families, the commissioner’s testimony did include a glimmer of hope. When asked flat out several times by the Budget Chair whether the level of cash assistance was “sufficient,” she would not answer. Perhaps that means the administration recognizes there is a problem after all and will help the efforts currently underway to restore some of the value of WorkFirst NJ. For the sake of the state’s poorest kids, let’s hope so.

A $15 Minimum Wage is Good Policy for New Jersey’s Working People & its Economy

Posted on May 16, 2016October 11, 2020 by Brandon McKoy

These are the prepared remarks delivered to the Senate Labor Committee today regarding S-15.

Raising the minimum wage to $15 an hour by 2021 is incredibly important for New Jersey’s workers, families, businesses, and economy. You will hear today from many who rightly note that New Jersey’s cost of living is very high, and that the current minimum wage comes nowhere close to enough to make ends meet, even for a single adult working full time.

The fact that full-time work isn’t enough to lift a New Jerseyan out of poverty should be enough to convince everyone in this room to raise the minimum wage. This fact alone is shameful.

And we aren’t just talking about a few New Jerseyans, or suburban teens looking for extra spending cash. According to our analysis, about 1 in 4 New Jersey workers would get a raise under this proposal. These are workers currently being paid less than $13.16 an hour – the equivalent of $15 an hour in 2021. Contrary to stereotypes, 91% of the affected workers are adults – only 9% are teenagers. Most are working full time and many are parents. More than 1 in 5 New Jersey children have at least one parent who would benefit from raising the wage.

So we know that there is a real need for higher wages, and that many New Jersey workers would benefit. But we also know, after researching minimum wage increases over several decades, that there is no correlation between raising wages and job losses. On the contrary, increasing the minimum wage spurs economic activity as people working low-wage jobs have more money to spend on their daily needs. Comprehensive studies by the federal government, the National Employment Law Project, and prominent academics all come to the same conclusion.

Opponents of fair wages here in New Jersey brush aside this rich history, and instead note that $15 an hour is “unprecedented” or “uncharted territory,” and thus we really don’t know how it will affect jobs and the economy.

First, this proposal to go to $15 an hour by 2021 is not unprecedented. In April 2005, then-Gov. Codey raised New Jersey’s minimum wage by 39% in two steps by October 2006 – a larger initial increase than this proposal, which would raise wages by 35% over the same time frame.

And second, we are starting to learn from the experience of the movement to $15 around the country. Recently, the University of Washington produced a report after interviewing over 560 Seattle employers affected by that city’s minimum wage increase, which is designed similarly to this proposal, with a long phase in allowing businesses time to adjust. Prior to the law taking effect, business lobbyists predicted that in order to comply with the change they would have to raise prices, add a service charge, or both. The study found that these predictions never came to fruition, and showed that as the minimum wage has gone up in Seattle, prices have remained the same and unemployment has gone down compared to surrounding areas.

Despite these facts, every time increasing the minimum wage is discussed, opponents warn with over the top hyperbole that doing so will lead to economic disaster, and every time they are proven wrong. It is past time that we acknowledge the opposition’s claims for what they are – scare tactics meant to prevent hard working people from being paid what they deserve. Adjusting and increasing the minimum wage is nothing new, and we have decades of experience with raising the minimum wage at local, state and national levels – experience that shows no correlation between increasing wages and significant price hikes, or widespread job loss.

The simple fact of the matter is that having a strong economy requires balance between healthy supply and healthy demand. Over the years, the state has taken many steps to address the supply side of our economy, with big tax cuts for businesses and billions in tax breaks through the Economic Development Authority. Businesses have received plenty of help from Trenton. It is far past time for lawmakers to take modest steps that boost workers and ensure healthy demand.

The evidence makes it clear that increasing the minimum wage to $15 is a common-sense policy that will positively affect workers, families, businesses and our economy, and we urge this committee to support this bill.

Corporate Subsidies Keep Flowing as New Estimates Confirm They’re Creating a Growing Long-Term Budget Hole

Posted on May 13, 2016October 11, 2020 by Jon Whiten

Today New Jersey will consider – and likely approve – $111 million in new tax breaks for corporations as the state’s surge in these subsidies continues.

If all of these tax breaks are approved, New Jersey will have OK’ed over $6.8 billion in subsidies since January 2010 – $4.2 billion of which has been approved since December 2013 alone under the misleadingly-named “Economic Opportunity Act.”

This flamboyant over-reliance on tax breaks to try to boost the state’s economy has done little to move the economic needle or grow good jobs. New Jersey, with among the most lucrative corporate subsidy offerings in the country, is one of just 10 states that hasn’t yet recovered all the jobs it has lost since the Great Recession’s official start in December 2007. This surge in subsidies is creating a long-term and growing economic drag that policymakers will have to grapple with for at least the next 15 years as the backlog of tax credits is paid out.

The regular monthly meeting of the state Economic Development Authority (EDA) comes after EDA officials appeared earlier this week in front of the legislative budget committees and released new estimates showing the damaging revenue consequences of already-approved subsidies.

These tax breaks will cost New Jersey an estimated $2.8 billion in fiscal years 2016 through 2020 alone, or an average of $550 million a year.

That’s a substantial amount of revenue that could be put to much better use by investing in the assets that, unlike tax breaks, are proven to grow New Jersey’s economy, like higher education or transportation, or providing a stronger safety net for the growing numbers of working New Jersey families and children who are living in poverty.

And the negative impact on New Jersey’s finances is only going to grow after 2020, as more of the corporations who’ve been approved for tax breaks in recent years cash in. Of the $4.1 billion in tax credits approved between December 2013 and April 2016, for example, only $12.9 million – or 0.3% – has been redeemed to date, according to the EDA.

The approval of more than $100 million in new tax subsidies in a month has become so commonplace in New Jersey, it’s easy to dismiss it as routine business. But what we’re in the midst of is far from routine, and comes with crippling consequences for the Garden State.

New Jersey is already in an enormous financial hole, unable to meet its obligations, provide essential services for all who need them and maintain adequate investment in its key economic assets. And every month that our leaders continue down this path of unbridled corporate largesse, the deeper and wider the hole gets. It’s time for lawmakers to observe the cardinal rule of holes: when you’re in one, stop digging.

UP TO DATE DATA ON NEW JERSEY & CORPORATE TAX SUBSIDIES

(as of May 12 – today’s approvals or modifications will change these totals)

The 2010s Have Seen a Subsidy Surge

• $6.7 billion: The dollar amount of total business tax breaks approved by New Jersey since January 2010. This is up from $1.2 billion the entire previous decade.

• $88 million: The monthly rate of business tax breaks awarded since January 2010. This is up from $10.1 million in the 2000s.

• $59,700: The cost per job of these subsidies since January 2010. This is up from $16,400 in the 2000s.

2013 Legislative Overhaul Opened the Floodgates Even Wider

• $4.1 billion: The dollar amount of total business tax breaks approved by New Jersey since December 2013, when the 2013 legislative changes went into effect.

• $140.9 million: The monthly rate of business tax breaks awarded since December 2013.

• $83,000: The cost per job of these subsidies since December 2013.

New National Report Underscores Why New Jersey Needs to Preserve its Estate Tax

Posted on May 11, 2016October 11, 2020 by Sheila Reynertson

Some New Jersey lawmakers are trying to take away one of the state’s most effective tools for both reducing inequality and building a thriving state economy at a time when the Garden State cannot afford to lose it.

The legislature is considering eliminating the estate tax as a bargaining chip to make a much-needed but unpopular gas tax increase more palatable. That would have disastrous consequences for essential public investments while putting more money into the hands of the state’s most well-off heirs, according to a new report by the Center on Budget and Policy Priorities.

As we have noted, a supermajority of New Jerseyans will never owe estate taxes. The tax, which is levied on all estates valued at more than $675,000, is paid by just 4 percent of estates per year. At a time when the imbalance between the richest and the rest is so extreme, a huge tax break for those at the top would only make this economic inequality worse.

The report also highlights how the estate tax helps – not harms – a state’s economy. Money that is collected through New Jersey’s estate tax helps communities thrive by providing hundreds of millions of dollars for higher education, transportation, health care and safe communities. Eliminating this revenue puts New Jersey’s economic future at risk due to the harm that subsequent service cuts can have on businesses and communities that depend on those services.

The report makes clear that claims that the estate tax harms the state’s economy by causing retirees and others to leave the state are exaggerated and are backed up with no credible evidence to support them. A review of recent studies finds that taxes have little to no effect on whether and where people move, and that the estate tax specifically has a small effect on the residence decisions of the very wealthy elderly. That confirms what we see here in New Jersey, where collections from the estate and inheritance taxes have risen by over 40 percent over the last 13 years. The negative impact of the estate tax, therefore, has only a small effect on a state’s economy and revenue collections – certainly much smaller than the impact of eliminating it.

Policymakers who are concerned about record levels of inequality and making sound investments that benefit all New Jerseyans should take this report to heart, and preserve the estate tax. New Jersey is in no condition to lose it.

Increasing the EITC to 40 Percent Would Boost Working Families & Create True ‘Tax Fairness’

Posted on May 10, 2016October 11, 2020 by Gordon MacInnes

The Earned Income Tax Credit is the best tool available to give New Jersey’s working families a shot at success. I want to commend the Senate President for being a champion for these families by pushing to increase New Jersey’s EITC to 40 percent of the federal credit.

The EITC boosts the incomes well over a half-million working families in New Jersey who aren’t paid enough to get by. It’s a proven policy initiated and sustained with strong bipartisan support with decades of success under its belt, and it’s a poverty solution well worth investing in. By boosting these families’ incomes, the EITC lifts – or keeps – many of them out of poverty and, crucially, gives their kids a better short at success later in life. Children from EITC families do better in school, and then have stronger employment prospects and greater earnings potential as they become adults.

And if you want tax fairness, the EITC is the most efficient and effective way to help fix a tax structure that is out of balance.

As it stands now, New Jersey taxpayers who are paid less than $22,000 a year pay the highest share of their income to state and local taxes: 10 percent of their incomes go to pay the tax bills. Meanwhile, the top 1 percent – folks with incomes over $758,000 – pay the least, with just 7.1 percent of their incomes going to taxes.

That’s because, even with a state income tax that is highly progressive and based on the ability to pay, other state and local taxes – namely property, gas and sales taxes – help make New Jersey’s overall state and local tax structure regressive.

If the EITC is increased from 30 to 40 percent, those poorest households would still pay the largest share of their incomes towards taxes, but not by nearly as much.

New Jersey is one of the most expensive states in the country, with housing costs in particular hamstringing the abilities of low-income and working-class families to move into the middle class and provide better opportunities for their children. Thanks to the leadership of the Senate President and the Assembly Speaker, policymakers have the opportunity to give these families a better shot at success – we hope they will seize it.

Raising the Minimum Wage Would Be a Great Mother’s Day Gift

Posted on May 8, 2016October 11, 2020 by Amy Dunford

Mother’s Day should be a time to recognize that moms have one of the hardest jobs in the world. So many work tirelessly every day for their families, investing in their children’s future around the clock by sacrificing their own needs for the betterment of their children. This full-time job doesn’t come with pay, benefits, promotions, raises, or much recognition.

On top of this, the share of American mothers who are working remains at or near all-time highs. This trend is commonly explained by striving white-collar women who aim to “have it all” by successfully balancing a hard-charging career and family. The story’s very different for low-wage working moms: stagnant wages have combined with rising costs for housing and other necessities to force more mothers into low-wage work simply to make sure their families have food on the table, a roof over their heads and clothes on their backs.

New Jersey’s current minimum wage is a paltry $8.38 an hour, or about $17,500 each year for a full-time worker who takes no time off. Simply put, that’s not even close to what it takes to make ends meet in high-cost New Jersey. Yet nearly 1 in 4 of the state’s working people are currently paid less than $13.16 an hour. That’s almost 1 million of our neighbors who are working but can’t even afford what the United Way of Northern New Jersey calls a “survival budget.”

In response to these dire conditions, lawmakers are pushing to increase the minimum wage to $15 an hour by 2021.

This gradual minimum wage increase would give New Jersey workers who aren’t paid enough to get by, a crucial pay bump – a raise that would disproportionately help women. While women make up 47 percent of the labor force, 53 percent of the individuals who would benefit from the increase are women.

Of the 975,000 New Jerseyans paid less than $15 an hour, 515,000 are women and 277,000 are parents, so we’re talking about a lot of mothers. If we want to improve the lives of mothers in the Garden State and seek ways to not just recognize motherhood on one Sunday in May, then let’s phase in an increase in the minimum wage to $15 an hour.

One in five New Jersey children have at least one parent — most likely their mother — paid less than $15 an hour. A minimum wage increase would not just benefit women and mothers, but their children as well.

Mothers are an important driver of New Jersey’s communities and its economy. With higher wages, moms could afford better housing, improve the quality of meals served and save for their children’s future. This would create a more stable economy and brighter future for New Jersey.

Of course, business lobbyists argue that raising the minimum wage will cause businesses to close or cut the number of employees and their hours worked. But we’ve had this conversation for decades, and there’s no evidence that raising the minimum wage leads to widespread job losses or stunts economic growth. On the contrary, with greater purchasing power being put into the hands of women, mothers and other working people, community economies are often stimulated when the minimum wage goes up.

And it’s not only local consumer economies that benefit by wage boosts. Another often-overlooked benefit is that raising the minimum wage can boost a company’s productivity because workers have greater incentive to work harder.

So this Mother’s Day, put yourself in the shoes of the New Jersey mom who is trying to balance work and family, all while being paid far less than it takes to survive. What would make her life easier? Forget the sentimental flowers and chocolates and give a gift that will last: a crucial wage boost.

Amy Dunford is the Kathleen Crotty Fellow at New Jersey Policy Perspective, which advances economic justice and shared prosperity for all New Jersey residents through non-partisan, data-driven research, analysis, advocacy and strategic communications.

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