New Jersey’s Economic Landscape and Minimum Wage Boost

We are all victims to fluctuations commonly associated with minimum wage (MW) adjustments.

In America, incomes mainly suffer because of a destructive health care policy and high taxes, especially for individuals who have not educated themselves sufficiently or picked up a lucrative skill. New Jersey’s minimum wage recently increased by 13 cents to $8.38, which many people who understand business know will only damage small businesses.

We are all victims to fluctuations commonly associated with minimum wage (MW) adjustments.

In America, incomes mainly suffer because of a destructive health care policy and high taxes, especially for individuals who have not educated themselves sufficiently or picked up a lucrative skill. New Jersey’s minimum wage recently increased by 13 cents to $8.38, which many people who understand business know will only damage small businesses.

Apparently, liberals in New Jersey are not tired of seeing people in the northeast leave to lower tax and more pro-business climates such as Florida and Texas.

How the Rate is Decided

The minimum wage adjusts according to a voter-approved initiative, so that it rises with the consumer price index, an inflation gauge. The hike for 2015 represents a 1.59% increase from last year’s rate of $8.25, up from $7.25 the year before, after voters agreed to the Democratic legislature’s demands. These same Democrats fail to realize that pushing up the MW only increases inflation.

Despite stout and significant opposition from numerous business groups throughout the State, as well as the Republican Governor, Chris Christie, the initiative managed to succeed. However, debates continue to rage over the impact that raising the MW could have because forcing businesses to pay someone who is unskilled that kind of money does not always make sense. How could it? Raising the MW only kills jobs and hurts young people who want to find a summer job and college students who rely on part-time work to help them survive.

The Impact of Higher Wages

According to a liberal think tank known as the “New Jersey Policy Perspective”, increasing the rate of the MW is a positive step towards boosting the wellbeing of minimum-wage workers, as well as improving the economy. These people do not own a small business and perhaps have never worked in a small business in their life. Many of these people grow up rich and do not understand the costs of running a small business. Some people believe America should not have a MW at all, just let the market dictate the price of that job.

If America dumped the MW entirely, America would see an increase of millions of jobs that first year according to small business owners across America and franchise managers.

A prediction was given that during 2015, wage increases could result in as much as $35 million worth of new economic activity, affecting a little under two hundred thousand people in the state. Alan Krueger suggests that an improved minimum wage will help the workers with the worst pay in the state to keep up with the costs of living. People like Krueger fail to understand that the intention of MW rules was not to support families. Raising the MW for the sake of irresponsible people undermines, not helps, the economy.

New Jersey Ruined its Job Growth Prospects

Business groups have argued that hikes to the minimum wage, including the increase in New Jersey, could lead to freezes in hiring based on business reasoning and basic logic. The director of the National Federation of Independent Businesses in New Jersey, Laurie Ehlbeck, spoke to a number of people running small businesses. According to her research, these homegrown businesses have had to put hiring on hold until they see how the increase will affect them. This means that although people are not losing jobs, growth has become stagnant.

New Jersey has been doing better under Christie, who has cleaned up a lot of the Democratic led corruption that existed for many years, but New Jersey needs to lower taxes and remove regulations that curtail business growth to make New Jersey a bright spot on America’s map. This latest liberal economic ploy will not help New Jersey at all.

The Economic Landscape

The unemployment rate in New Jersey is among the highest in the United States, but it has been dropping because of Christie’s leadership. In November, the rate dropped by approximately 0.2 points, down to 6.4% (it is probably higher considering this number does not include those people that have stopped looking for work). According to the Labor Department, (another bloated federal department that doles out underserving large salaries) this is the lowest rate since 2008.

Despite these positive movements, sectors in the state’s economy continue to struggle. The leisure and construction industries in particular suffer from a shrinking workforce. Leisure and hospitality saw employment drop 3.1%, whereas construction jobs declined 4.5% compared to last year.

Now, approximately 4% of the 4.5 million workers that currently earn the states MW just received a raise for doing absolutely nothing.