Newest Hike in Minimum Wage Set To Yield Massive Layoffs
The minimum wage has, again, risen for business owners in New York State. Its another hike and another crushing blow for small businesses already struggling with one of the nations worst tax codes and most suffocating regulations. Weve already had seven hikes since 2007 and five since 2013; its an unsustainable trend.
The misguided narrative insists raising the minimum wage will help lift employees out of poverty, but theyre ignoring the massive layoffs, increased reliance on automation and loss of benefits so many New Yorkers will suffer as businesses, both large and small, try to reconcile their bottom lines. This is bad policy largely driven by politics masquerading as sound economic policy.
BUSINESSES ALREADY PLANNING TO MAKE CUTS
A survey from the New York City Hospitality Alliance shows 47 percent of full-service restaurants included in the survey are planning to cut jobs this year as a result of the state-mandated minimum wage hike. In one years time, that number is up from 36 percent.
The new wages, which are $11.10 per hour in upstate New York and $15 per hour for fast-food employees in New York City, are an egregious mandate. A far more reasonable policy would be to allow businesses to pay a training wage to new employees that is less than the state-mandated minimum wage. This would allow new employees to gain the experience needed to move up in the workforce without crippling job owners already reeling from New Yorks toxic business environment.
Those in favor of continually raising the minimum wage would tell you its the right thing to do for those struggling to make ends meet. But, no policy exists in a vacuum. Small business owners simply cannot afford to pay these wages without drastic change. They are going to be forced to reduce their workforce, putting more employees out of work and subsequently straining our public benefits. We are trying to get people off unemployment, not add to its rolls.
LEAVE THE TIPPED WAGE ALONE
Further, a proposal to raise the minimum wage for tipped workers at the expense of their tipped wage credit has been floated around in recent months. This has been expressly rejected by the very tipped workers who would be directly impacted. Its almost unbelievable that its still on the table. Tipped workers rely heavily on the generosity of their patrons. This is yet another example of Cuomo and his liberal allies trying to find a solution for a problem that doesnt exist.
The Assembly Minority Conference has repeatedly called for a more balanced solution to help working-class folks. We cannot ignore the fiscal realities of these wage hikes, no matter how compassionate it may seem on the surface. Good policy is rarely as simple as the minimum wage proponents would have you believe.
What do you think? I want to hear from you. Send me your feedback, suggestions and ideas regarding this or any other issue facing New York State. You can always contact my district office at (315) 781-2030 or email me at email@example.com.