Bottom Lines: New Jersey business group calls latest plan to increase minimun wage unrealistic and unconstitutional - pressofAtlanticCity.com: Business

Bottom Lines: New Jersey business group calls latest plan to increase minimun wage unrealistic and unconstitutional - pressofAtlanticCity.com: Business

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Bottom Lines: New Jersey business group calls latest plan to increase minimun wage unrealistic and unconstitutional

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Posted: Sunday, September 30, 2012 12:00 am

Having failed to get a 17 percent increase in the state minimum wage through the Legislature in May, the president of the Senate, Sen. Stephen Sweeney, now wants a constitutional amendment to raise the minimum wage and ensure automatic increases annually forever.

Needless to say, the business community opposes the scheme as a political intervention in the labor market that would burden New Jersey businesses and make the state less competitive economically.

The issue is important for the shore’s tourism economy, which relies on a large number of temporary workers each summer, including many teenagers here on work visas and locals getting their first jobs.

The New Jersey Business & Industry Association said this past week that the proposed minimum wage increase — nearly 14 percent to $8.25 an hour — in this weak economy would force businesses to pay more when their own sales have typically increased a mere 2 percent.

Job cuts, reduced spending by businesses and a further slowing of the economy would be inevitable, the association said.

In addition to these arguments that were made against May’s proposed increase to $8.50, the group adds another this time: Mandating wage increases is not an appropriate use of the state Constitution.

“Even those who support an increase in the minimum wage should recognize that messing with the constitution is not the way to do it,” Philip Kirschner, president of the NJBIA, said in a statement. “People elect the Legislature to deal with these issues.”

The Record newspaper in Bergen County this week called the Sweeney plan a California-style scheme and said that state “has gone in 50 years from the exemplary to the ungovernable. It is bankrupt and locked into numerous policies and practices that once seemed like a good idea.”

The NJBIA said legislators instead should focus on measures to make the state economy stronger, and on training programs to help low-wage workers qualify for better-paying positions.

Jobless data revisions

The other branch of state government, the executive branch, spends a lot of time and effort these days trying to put a better face on New Jersey’s unemployment rate, which has risen from 9.2 percent in May to 9.9 percent in August.

State officials must be living in dread of the possibility that the slowing U.S. economy will push September’s jobless rate into double digits.

The past two months, the state press release announcing the latest jobs report has begun with a lengthy explanation of how a higher unemployment rate might not be as bad as it looks. For reporters used to reading the financial statements of companies, such attempts to bury the bad news have the opposite effect of making it seem worse, if anything.

On Friday, the chief economist of the N.J. Treasury Department, Charles Steindel, issued his New Jersey Economic Insights for September.

This newsletter, too, has become a tool in the probably vain struggle to prevent state residents from becoming more pessimistic about the economy and job prospects.

Steindel says we should be skeptical about whether the deteriorating job figures accurately reflect conditions in the state. The recovery is continuing, “though perhaps less briskly than in winter or spring.”

Brisk is not a word I’d use for any part of the state or national economic recovery since 2009.

Sure, the federal Bureau of Labor Statistics said 47,500 fewer N.J. residents were working in August than in May, Steindel says, but if that’s true, how come more of them didn’t apply for jobless benefits?

Employment numbers are volatile and subject to revisions, up and down.

Perhaps in a few months the jobs picture in New Jersey won’t look worse than it’s been — just still bad.

Contact Kevin Post:

609-272-7250

KPost@pressofac.com

© 2014 pressofAtlanticCity.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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