US Senate Bill Would Hike Minimum Wage to $9.80 An Hour [AUDIO]
A bill to increase New Jersey’s minimum wage from $7.25 to $8.50 an hour passed the full Assembly in May, but stalled in the State Senate because Governor Chris Christie vowed to veto it.
There’s now a bill in the U.S. Senate to hike the federal minimum wage to $9.80 an hour over three years and if it becomes law there’s nothing Christie can do about it.
The “Fair Minimum Wage Act,” introduced by Iowa Senator Tom Harkins, would raise the minimum wage to $9.80 in three incremental increases of 85 cents an hour, and would tie future increases to inflation.
According to the Economic Policy Institute (EPI), increasing the federal minimum wage to $9.80 per hour would give 485,660 New Jersey workers an average raise of $596 per year, giving low-wage workers a leg up in high-cost New Jersey while stimulating the state’s economy through increased consumer spending.
New Jersey Business and Industry Association president Phil Kirschner says, “If you have to pay 35% higher labor costs and your sales are only going up 3%, hours are going to be cut (and) jobs are going to be lost……When you raise wages that high that money has to come from somewhere.”
“The proposal to increase the federal minimum wage makes great sense for New Jersey: it would help families that are ‘playing by the rules’ struggle into the middle class, while generating greater consumer spending to help our anemic economic recovery” says Gordon MacInnes, president of New Jersey Policy Perspective (NJPP). “With the current state of political paralysis in Washington, quick passage of the Harkin bill is unlikely. New Jersey’s governor and legislature could set an important example by enacting the bill increasing the minimum wage to $8.50.”
NJPP contends that while increasing the minimum wage immediately benefits the lowest-paid workers through boosted earnings, it also yields positive effects on the larger economy. Raising the federal minimum wage to $9.80 would put nearly $1 billion in the hands of New Jersey’s working families when they need it most, augmenting their spending power in the local economy. In return, these families would be more likely than any other income group to spend these extra earnings immediately, in New Jersey, on basic needs or services they could not previously afford.
“Harkins is looking at a 35% increase,” explains Kirschner. “No one in the private sector has gotten anything close to that over the last few years.”
EPI researcher Doug Hall says, “Now is the perfect time to raise the minimum wage. Not only will it generate billions of new dollars for the economy while adding new jobs when we sorely need them, it will begin to address the wage stagnation working families have faced during the last four decades, while putting more money in their hands when they need it most.”
Kirschner doesn’t believe Harkins’ bill will get any serious consideration. He says, “To raise wages irrespective of what’s happening in the economy makes no sense whatsoever.”