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Ballot Question #2 Could Give a Raise to NJ's Minimum Wage Workers

Current Minimum Wage Would Increase to $8.25/Hour and Increase Annually to Account For Cost of Living
TheFreshGrocer
The new FreshGrocer supermarket in New Brunswick employs many people at the federal minimum wage: $7.25/hour. Charlie Kratovil

NEW BRUNSWICK, NJ—This Election Day, New Jerseyans will decide whether to boost the minimum wage by a dollar immediately and likely cause further increases in the hourly rate based on cost of living.

Public Question No. 2 gives voters the chance to approve the increase if more "yes" votes are cast than "no" votes.

It is a contentious issue.  Currently the minimum wage is just $7.25 per hour, the same standard used by the federal government.  However, the cost of living in New Jersey is the third highest in the nation, behind Connecticut and New York.

According to recent polling by the Eagleton Institue of Politics in New Brunswick, NJ voters tend to support the "yes" vote by a wide margin: 76% to 22%.  A Monmouth University survey found voters would even be willing to raise the minimum wage to $10.50, with 41% in favor to 31% against.

Only 16% of Jersey voters would be willing to hike the wage to $15, a level that some fast food workers had called for.

On the one hand, a 14% raise in the pre-tax earnings of New Brunswick's minimum-wage employees stands to bring those workers closer to a wage they can live on.  Apartments, mortgages, taxes, health insurance, food, and transport are all expensive, and a minimum wage increase, that goes up with inflation, would help employees cover the bills.

But opponents say that such an increase would make workers more expensive, an in turn make employers more reluctant to hire new staff.

By following the increases in cost of living, rather than leading, the minimum wage hike here would not contribute to inflation.

Small business groups are on record as both favoring and opposing the minimum-wage hike.

A group supporting the income boost, the Main Street Alliance, argues that a minimum-wage increase would induce employees to spend more money, helping improve the overall state economy and benefitting small businesses.

The opponents, such as the Employment Policies Institute, argue that minimum wage increases would hurt teenage employees, increase payroll taxes, increase the cost of government, and potentially curb hiring of minimum-wage government workers.

The EPI has asserted that an increase in NJ's minimum wage would affect 13,000 state and local employees.  According to the EPI, the additional cost of $21.6 million in compensation would be passed on to NJ residents, at the rate of $2.44 per year, for each New Jersey resident. 

QUESTION APPEARS AT BOTTOM OF THE BALLOT
"Do you approve amending the State Constitution to set a State minimum wage rate of at least $8.25 per hour? The amendment also requires annual increases in that rate if there are annual increases in the cost of living.

Interpretive statement: This amendment to the State Constitution sets the State minimum wage at the level in effect under current law, or $8.25 per hour, whichever is more. Cost of living increases would be added each year. Also, if the federal minimum wage rate is raised above the State rate, the State rate would be raised to match the federal rate. Future cost of living increases then would be added to that raised rate."

This is how the question reads on the ballot. Essentially the minimum wage allowed in New Jersey would raise automatically based on the cost of living, which is assumed to be rising.  The wage rate would never lower, even if the cost of living declines.  The minimum wage would be immediately raised by $1 to $8.25/hour.