NJ's $15 / Hour Minimum Wage Law

Runner Guy

It looks like Murphy, Sweeney, and Coughlin have an agreement to raise the minimum wage to $15 per hour.

https://www.nj.com/politics/2019/01/murphy-top-nj-dems-strike-deal-to-raise-minimum-wage-to-15.html

I'm curious to hear your reactions, especially if this will affect you personally as a worker, consumer, or employer.


terp

I, for one, welcome our new kiosk overlords. 


John

Has to lead to inflation.


drummerboy

It's about time.

As for inflation - Seattle seems to be doing ok with their $15 minimum wage. Nothing like real-world evidence.


jmitw

ideally, employers would just step and pay employees what they are worth based on their work.  if someone insists on acting stupid and half brain dead, they get $1/hour.  If they put the effort in and have a good attitude, they get $15....but that is not going to happen.


With walmart paying $15/hour, more people --with better work skills-will be applying to work there....and those with poor skills will be pushed out of job opportunities


Stanley

When I raised the issue of "worth" to my High School Economics teacher he told me that there was no such thing; that prices, wages were determined by supply and demand.


jmitw

employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).

employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.


kthnry

Can we break this down into two parts? 

1. Should there be a minimum wage at all?

2. If yes, what should it be?


Stanley
jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.

 

Employee A should be fired.

Employee B should be paid generously.


And as we type there are government employees working diligently and getting paid nothing.


Runner Guy

I think the $15 an hour is going to have a lot of unintended consequences.  It makes me sad to think of hardworking people making less than $15 an hour, but consumer decisions are rarely based on ethics.

Producers of tradable goods who compete against businesses in other states, like manufacturing and especially agriculture, are going to be an uncompetitive position.  Although the minimum wage for farmworkers will only be $12.50 per hour, that's still very high compared to what farms have to pay in most of the US.  Since NJ's taxes are among country's highest, NJ farms and manufacturing will be doubly disadvantaged.

I think childcare expenses are going to increase as a result of this too.  If a family can't afford childcare, then the father or mother is going to drop out of the labor force.  If a childcare center can't make a profit (or a sufficient profit) and closes, that is going to be a hardship for the caregivers as well as the parents and kids.

A restaurant isn't a necessity, but restaurants employ about half of the minimum wage workforce.  Based on San Francisco's experience, restaurants that are anything other than great are going to close and fewer entrepreneurs will try to open one.  This bodes ill for South Orange Avenue's revival.

It frustrates me that the advocates for a $15 an hour minimum wage don't even acknowledge that there are tradeoffs, even if they believe that $15 / hour is a net benefit.  Even if someone thinks this is overall a good thing, there are winners and losers. 

An entity that I think will be a winner from this is Amazon.com.  Paying $15 an hour is no problem for them because they are so heavily automated anyway.


jmitw

don't get me started on government employees...the ones I have dealt with only worked very hard at reinforcing the negative stereotypes about gov't employees.

IRS didn't know their own regs, I had to keep sending them copies of their own regs, I eventually went up against their lawyer and won.

notified an employer of a request for a reasonable disability accommodation, was fired, filed EEOC complaint providing copies of multiple emails and mail receipts for the accommodation request.  employer claimed they didn't know anything about my request, EEOC took their word over the emails/mail receipts.

A municipal court refused reasonable accommodations suggested by the state judiciary.  USDOJ just sent a form letter 18 months later declining to investigate...an abuser was enabled to commit a crime against me..what case can be more important than a COURT violating civil rights?

and that is not all.



jmitw
STANV said:


jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.
 
Employee A should be fired.
Employee B should be paid generously.


And as we type there are government employees working diligently and getting paid nothing.

 Employee A will end up fired when more people are willing to take his job and actually do his job when they can get $15/hour....and he will be jobless altogether...and yeah, I have encountered a number of workers like that.


Runner Guy

Sen. Vin Gopal has some important comments here.

I think/hope that in the final legislation there is an off-ramp in case employment falls.

But not all Democrats are on board. Sen. Vin Gopal, D-Monmouth, called for the bill to be voted down over the small business provision. He said owners of coffee shops or ice cream parlors, as examples, do not typically make large salaries and often struggle in their early years to establish a foothold. He also criticized the plan having "no concrete economic study" to determine its potential impact.

“The deal announced today by the Democratic Party leadership is a disastrous deal that will issue a devastating blow to our small business community and inevitably result in the closure of countless mom and pop shops,” Gopal said in a statement. "These are not large corporations that can absorb the blow. Forcing small business owners to drastically raise their minimum wage over this short period will result in layoffs and closures, which will ultimately hurt our local economy and will only empower bigger corporations." 


https://www.northjersey.com/story/news/new-jersey/2019/01/17/deal-reached-raise-njs-minimum-wage-15-hour/2607027002/


drummerboy

Yeah, that's the exact same thing they said would happen in Seattle.


Michael

If one does the math, and would take a very long post but basically the average price of a sandwich or an entree will have to increase by a nickel and the average soft drink option would have to increase by a penny to cover the increase.  Will have no impact on employment.   (there are tons of studies on the subject and tons of breakdowns). 

And paying people 7.25 /hour (federal minimum wage) is as bad as slavery.  


employee performance has nothing to do with minimum wage.  



ml1

this wage increase phases in over five years. It's really unlikely that such a gradual increase will have any kind of negative effect on employment.  Almost certainly not an effect that can be separated from larger trends in the economy.


Scully
jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.

 

Not on any job I’ve held - employee B rises up the ranks faster, gets more frequent increases and/or more hours (depending on what level of employment we’re talking here)


drummerboy
jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.

 I guess everyone's missed the "racially tinged" nature of the description of employee A.


Steve
drummerboy said:


jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.
 I guess everyone's missed the "racially tinged" nature of the description of employee A.

 Not everyone.  Not everyone responds to trolls.


drummerboy
Steve said:


drummerboy said:

jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.
 I guess everyone's missed the "racially tinged" nature of the description of employee A.
 Not everyone.  Not everyone responds to trolls.

 Point taken - but people did respond to his post, while ignoring his nonsense - thereby implicitly supporting his nonsense..


ml1
drummerboy said:


Steve said:

drummerboy said:

jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.
 I guess everyone's missed the "racially tinged" nature of the description of employee A.
 Not everyone.  Not everyone responds to trolls.
 Point taken - but people did respond to his post, while ignoring his nonsense - thereby implicitly supporting his nonsense..

I noticed, but I figured it was someone else's turn to call out this ****.


yahooyahoo
ml1 said:
this wage increase phases in over five years. It's really unlikely that such a gradual increase will have any kind of negative effect on employment.  Almost certainly not an effect that can be separated from larger trends in the economy.

It's even slower to phase in for certain categories of employees.  Some won't get to $15/hr until 2026.  It's a very slow increase.


Klinker

I support a $15 minimum wage but, if we are going to be honest, its just a bandaid on a gushing chest wound.  What we need in this country is a minimum income that takes the burden off of small business owners and places it where it belongs, on the beneficiaries of the gulf between the haves and the have nots.


max_weisenfeld

 

ml1 said:


drummerboy said:

Steve said:

drummerboy said:

jmitw said:
employee A: mumbles, acts dazed, pants hanging down, takes an hour to complete work that should take 15 minutes, playing gangsta rap on his phone while he works (audible to customers).
employee B: pleasantly interacts with co workers and customers speaking clearly, proactive, demonstrates good knowledge of the business, works quickly/does 4x the amount of work of employee A, dresses appropriately....


yet they get paid the same.
 I guess everyone's missed the "racially tinged" nature of the description of employee A.
 Not everyone.  Not everyone responds to trolls.
 Point taken - but people did respond to his post, while ignoring his nonsense - thereby implicitly supporting his nonsense..
I noticed, but I figured it was someone else's turn to call out this ****.

 Allow me.

This is some racist ******** right here.   Poster #1 (jmitw) should be fired.


Runner Guy

I don't know how the consequences of a $15 minimum wage aren't going to be worse for New Jersey than they are New York City.

Just last year, the Coffee Shop — a Union Square institution — closed, and while some point solely to high rents, the owners stated that the scheduled $2 minimum wage increase would have added $46,000 to their monthly payroll, making it impossible to simply break even.

St. Mark’s Comics, which had operated in the East Village for 36 years, will close this month. In closing, the owners stated, “There are lots of obstacles to running a retail storefront in NYC; too many of them at once to fight.”

https://www.nydailynews.com/opinion/ny-oped-nyc-small-businesses-are-on-the-ropes-20190205-story.html


DaveSchmidt
Runner_Guy said:
I don't know how the consequences of a $15 minimum wage aren't going to be worse for New Jersey than they are New York City.

From the owner of the Coffee Shop, in the original linked article (Forbes):

“I do think it’s going to leave a hole of some sort in Manhattan; I don’t know when there will be another. But then, there’s always the next one,” he said. “I’ve been joking with my friends that everyone is crying now but 30 days from now people will have moved on. That’s what we do in New York. In New York we move on. It’s a moving, changing city and there will be other things that come up and The Coffee Shop just be a great memory.”

St. Mark’s Comics didn’t list the obstacles it faced, minimum wage or otherwise. But there’s no reason to object to its being in the Daily News op-ed, since that writer is also talking about city regulations in general.


qrysdonnell

How does that math work out that a $2 increase in an hourly wage turns unto $46,000 a month? How many employees do they have working at a time? 100+?


ml1
qrysdonnell said:
How does that math work out that a $2 increase in an hourly wage turns unto $46,000 a month? How many employees do they have working at a time? 100+?

it was mentioned that the restaurant had about 150 full time employees.  The restaurant was huge by NYC standards.  But it's another article written by someone with an axe to grind about minimum wage earners getting a modest raise.  My back of the envelope calculation was that an increase in prices of less than 5% would have covered the wage increase.  It's hard to believe that patrons of Coffee Shop wouldn't have gladly paid that if it was explained to them that their $15 burger was going to cost $15.75 so the dishwashers could get a raise.  The real reason that places like that go out of business is typically the sky-high rents that are non-negotiable.



Michael

I just did a consulting job for a small restaurant.  I showed him how if raised the prices of all his menu items by a nickel (average increase was under 2%, it would completely cover the cost of the full increase in minimum wage.  This  was a high volume low priced restaurant.  

I also did for a day care center.  Average monthly cost was going to increase by about 5% .  I suggested they phase it in over 3 years (and mind you - this was so they could maintain the same annual net profit of over 500,000).  

I think a much larger issue in NY and NJ are the insane rents and all the little taxes/fees that business owners get hit with.  


Runner Guy
ml1 said:


qrysdonnell said:
How does that math work out that a $2 increase in an hourly wage turns unto $46,000 a month? How many employees do they have working at a time? 100+?
it was mentioned that the restaurant had about 150 full time employees.  The restaurant was huge by NYC standards.  But it's another article written by someone with an axe to grind about minimum wage earners getting a modest raise.  My back of the envelope calculation was that an increase in prices of less than 5% would have covered the wage increase.  It's hard to believe that patrons of Coffee Shop wouldn't have gladly paid that if it was explained to them that their $15 burger was going to cost $15.75 so the dishwashers could get a raise.  The real reason that places like that go out of business is typically the sky-high rents that are non-negotiable.


Manhattan is a place where a $15 minimum wage is at its most defensible, since Manhattan's average wage is over $35 per hour and it gets tons of high-income tourists too.   

However, if $15 an hour is a contributing factor in business closings in a very high-income place, you can imagine much more significant consequences across an entire state, such as New Jersey, where in some towns (like Bridgeton and Camden) the average income is below $15 per hour.  

It's hard to believe that patrons of Coffee Shop wouldn't have gladly paid that if it was explained to them that their $15 burger was going to cost $15.75 so the dishwashers could get a raise.

As a regular consumer I would very well pay $15.75 for something that would cost $15, but if I ran a business or large organization and bought a product in bulk and could choose between different suppliers I would not pay a 5% premium for a product.  

I therefore think that the businesses that are most at risk from a $15 minimum wage aren't restaurants, but businesses that compete against businesses in other states and sell to other businesses, like farms and manufacturing.  Although NJ farms are only going to have to pay $12.50 an hour by 2024, that's still a large premium compared to the rest of the country.  

Also, for products that already are expensive, a 5% premium will be real money. 

So, yes, anyone can pay another 75 cents for a hamburger, but what about something that is already very expensive, like daycare?  Even inexpensive daycare around here is $15,000 a year, so there a 5% increase is $750, not 75 cents.  




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