A $15 minimum wage is moving towards reality in New Jersey. Enjoy your $25 cheeseburger.

According to a story on NJ.com New Jersey State Assembly Speaker Craig Coughlin says he expects a vote on a $15 minimum wage in December or January.  New Jersey’s minimum wage is $8.60 an hour. It will rise 25 cents an hour to $8.85 in January due to past legislation tying annual increases to changes in the consumer price index.  I’ll never understand why Democrats want to put the burden of a higher minimum wage on New Jersey employers (and ultimately consumers) rather than the state encourage and assist New Jersey residents in getting the education and skills needed to make them more valuable in the job market.

New Jersey is in a somewhat unique position in the number of seasonal employees along the Jersey Shore.  This includes everyone from those who clean motel rooms, serve food along the boardwalk and operate rides.  Many of these employees are students with summer jobs down the shore.  Murphy, Coughlin and Sweeney believe a kid with a summer job serving ice cream on the boardwalk should earn $15 an hour?

Seaside

On a larger scale we are already seeing fast food giants like McDonalds move to automated kiosks (McDonalds has said they will automate 1,000 restaurants per quarter over the next two years with self ordering kiosks).  One only has to go to a big box retailer or chain grocery store and look at how many self-service checkout lines are available vs. cashiers.  Technology is already killing entry level minimum wage jobs.  I anticipate that a raise in the minimum wage to $15 per hour will rapidly continue that trend.

McDonalds

I talked about this in a prior blog post “Governor Murphy a $15 minimum wage is not good for the people of New Jersey“.  In that post I provided examples of study after study in which Economists found that dramatically increasing the minimum wage hurt the very people it was designed to help.  The studies also demonstrated that a dramatically increased minimum wage is devastating to small businesses and increases consumer costs.

I have spent 24-years in talent acquisition and human resources.  In that time I’ve learned that the job market is talent driven.  Talent drives wages.  Skilled workers are always in demand (even in a down economy) and command their worth.  I see dramatically increasing the minimum wage (much as I see unions in 2018) as a form of welfare subsidized and forced upon employers.  Why are we rewarding people for not taking the initiative to better their education and skills.

I’d like to propose a solution.  This is a rough draft of a plan that may initially cost tax revenue (I believe if the Democrats can propose funding free college tuition for undocumented illegal immigrants they can find the money to help New Jersey residents) but in the long run will make us a more productive state, decrease our welfare roles and help New Jersey attract industry with an increasing skilled workforce.

My plan is simple.  Job skills training and support for those in New Jersey who earn below a threshold working or are on welfare.  Let’s help those in New Jersey who want and need to earn higher wages by providing job skills training (in some cases with a path to a college degree), childcare assistance, transportation assistance and once a program is completed assistance finding a job.  When someone completes a job skills program let’s continue to provide childcare and transportation subsidies for a year to give the person time get on their feet.  Let’s put the responsibility of earning a higher wage on the employee by increasing their skills and value to employers not on businesses and consumers by increasing  costs.  Let’s not make minimum wage jobs career opportunities but part of a path.  I propose that we give welfare recipients two years to complete a program or they lose their welfare benefits.  Let’s set a better example and show the youth of New Jersey that minimum wage jobs and welfare are not career choices but simply a step.

This is obviously the broad strokes of a much more detailed plan.  We know that not every person participating in the program will become an Engineer.  Training can very from assistance getting a CDL so someone can drive a truck to IT certifications if someone wants to pursue a career in technology.  If someone shows the aptitude and commitment to pursue a college degree (or even a graduate degree) let’s help them reach their potential.  This seems like a better idea then raising the minimum wage putting the burden on small businesses and consumers and keeping people stuck in entry level minimum wage jobs.

Murphy Sweeney Coughlin

I call on Governor Murphy, State Senate President Sweeney and State Assembly Speaker Coughlin to put in the work to come up with a better plan.  Let’s put the burden of increasing skills and value in the job market on employees not employers.  Let’s end lifetime welfare.  Let’s make New Jersey a magnet for industry by increasing the skilled labor pool and making compensation market driven as it should be.