NORTH WILDWOOD — With about 130 employees, the Gateway 26 casino arcade is one of the largest employers on the Wildwoods Boardwalk outside of Morey’s Piers.

But this year, the number of employees was cut in half with the implementation of a new system that counts and distributes points and tickets toward prizes. The system, which debuted this week, is part of a $600,000 investment to head off an expected minimum wage increase to $15 per hour, something Gov. Phil Murphy campaigned on and vowed to bring to New Jersey.

“I feel bad that we had to do this, especially for 14- and 15-year-old kids that worked here,” said Brian Sharpe, owner and managing partner of Gateway 26, located on the Boardwalk at 26th Avenue. “But with the probability of a $15 minimum wage … we could not take those extra costs and put it on the consumer and expect to stay competitive.”

Nowhere in the United States can someone working a full-time, minimum-wage job afford to rent a two-bedroom apartment, according to a new study by the National Low Income Housing Coalition. In New Jersey, one of the most expensive states to live in the country, the problem is particularly bad.

But raising the minimum wage to $15 per hour could squeeze small businesses and hurt the local economy, particularly in shore towns that rely on seasonal businesses to bring people to the area, some economists say. Now, lawmakers in Trenton are grappling with an affordable housing crisis and the negative effects their proposed solutions could have on the state’s economy.

“You can’t just hit the businessman over the head by making the minimum wage $15 an hour next year,” said Assemblyman Vince Mazzeo, D-Atlantic, who also owns the B.F. Mazzeo produce market in Northfield. “It has to be a gradual change over three to five years, and there has to be carve-outs for agriculture and seasonal businesses.”

A person making minimum wage would have to work an average of 131 hours per week, or more than three full-time jobs, to afford a two-bedroom rental unit in this state, according to the NLIHC.

South Jersey fares better than central or northern New Jersey, the report found, but not by much.

In Atlantic County, the average person making minimum wage, which is $8.60 per hour, has to work 117 hours a week to afford a two-bedroom rental. In Cape May County, the number is 101, Cumberland is 103 and Ocean is 131.

Raising the minimum wage to $15 per hour would cut down on the number of hours needed to work, but ideally, a resident in New Jersey has to make about $28 per hour to afford a two-bedroom rental, the NLIHC report found.

“Make no mistake: While the housing market may have recovered for many, we are nonetheless experiencing an affordable housing crisis, especially for very low-income families,” U.S. Sen. Bernie Sanders, who ran for president in the Democratic primary in 2016, said in a statement with the NLIHC report. “That is because wages have been stagnant for decades, while the cost of housing keeps going up.”

But raising the minimum wage to $15 per hour would result in the loss of nearly 32,000 jobs in New Jersey, according to a separate study by the Employment Politics Institute.

The most affected demographic would be people without a college degree, which includes teenagers who have not yet finished school, the EPI study found. Overall, about 90 percent of the job losses would be people who don’t have a college degree and would affect the retail, recreation accommodation and food service industries.

And it is unclear how many people would be pulled out of poverty in New Jersey because half of the working-age people who live in poverty do not have a job, and thus would not be affected by the minimum-wage increase, the EPI study said.

“We have to choose between a 14-year-old and someone who has 20 years of work experience … and we’re going to lean toward the person with experience,” Sharpe said, adding that a person working on the floor made about $10 per hour in the old system. “I feel bad for minors because I think it’s going to be extremely hard for them to get jobs.”

Jason Dugan, co-owner of Douglass Fudge on the Wildwood Boardwalk, agreed there would have to be changes if the minimum wage were raised to $15 per hour.

“I think it might hurt the consumer with higher prices,” Dugan said, adding he has about 40 employees between two stores. “I agree that employees should be paid fairly because they are honest, hard-working people, and we try to do our best with that already.”

Mazzeo said he has heard concerns from people in Atlantic County about a minimum-wage hike, but added that other legislators share concerns about seasonal businesses.

“You have to remember that the people who now make $15 or $16 an hour will probably also have to get a raise to make it fair,” he said. “I’m not sure what (Phil Murphy) will support, but there has been discussion among (legislators) about those carve-outs.”

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