Increasing New Jersey's minimum wage would boost the state's ailing economy while improving the lives of many of the state's working families, as shown by a new analysis prepared by the Economic Policy Institute and released by New Jersey Policy Perspective.
New Jersey is considering raising its minimum wage from $7.25 an hour to $8.50 an hour, and indexing further increases to inflation. Despite the fear tactics being used by opponents, the increase would provide an immediate benefit the state's economy, which is still firmly in the grips of a weak recovery:
• Wages would increase by $489 million in the first year
• Overall economic activity would increase by $278 million in the first year
• The equivalent of 2,420 new full time jobs would be created
Over a half-million New Jerseyans would feel the direct impact of the wage increase, including 307,255 workers who currently make less than $8.50 an hour and 233,028 who make just above $8.50 an hour (they will receive raises as pay scales are adjusted upward).
Raising the minimum wage is the right thing to do for New Jersey's working families. It's also the right thing to do for our ailing economy. Approving the proposed $1.25 per hour increase will ripple throughout New Jersey, producing an estimated $278 million in new economic activity. That's what I call a smart investment.
Contrary to popular mythology, many of New Jersey's low-wage workers are educated adults who are working hard. Eighty-five percent are at least 20 years old, nearly half have attended college or have a college degree, and only 19 percent are working less than 20 hours a week.
Many are also parents. Raising the minimum wage will help give the 282,545 New Jersey children with parents working for low wages a better shot at a more prosperous future.
How can the legislature or the governor expect anyone to support themselves in one of the most costly states in the nation for less than $8.50 an hour, much less support a family? New Jersey must do better than that.
We've taken the first step, with the Assembly passing the bill last week. Now it's up to the Senate and Governor Christie to follow suit and do the right thing.