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Study: Minimum wage hikes donít kill jobs
NJ101.5 ^ | 7/21/2014 | Kevin McArdle

Posted on 07/21/2014 9:27:34 AM PDT by Incorrigible

Study: Minimum wage hikes don’t kill jobs

By Kevin McArdle July 21, 2014 5:14 AM

A new study by the Center for Economic and Research Policy shows that job growth in states that increased their minimum wages this year is far more robust when compared to states that did not hike the minimum wage.

Thirteen states increased their minimum wages in 2014, including New Jersey. According to the report, the average change in payrolls in states that implemented minimum wage hikes was 0.99 percent.  For states that didn’t see a minimum wage hike, it was 0.68 percent.

However, the report said there is not a direct link between the two, but opponents and supporters of the Garden State’s wage increase both had something to say.

“It was nonsensical to debate whether we should raise the minimum wage in New Jersey by one dollar. It is a no brainer because that money was going to immediately be coming right back into our local economy,” said Assemblywoman Sheila Oliver (D-East Orange), who helped spearhead the effort to increase the wage.

In November, New Jersey voters overwhelmingly approved a ballot question to hike the wage from $7.25 an hour to $8.25 and to tie future increases to the rate of inflation every year.  The increase went into effect on January 1.

Many in the Garden State business community fought against the minimum wage increase and aren’t convinced the study proves anything. What do they think the impact will be on employers?

“Honestly it’s too early to tell,” said David Brogan, first vice president with the New Jersey Business and Industry Association. “What we do know is that it’s a government mandated increase in labor costs. That money needs to come from somewhere. That could mean less hours, less bonuses, less shifts and potentially less employees.”

The wage increase is not only helping businesses find workers, it is helping them hold on to the employees that already have Oliver said.

“I think that we have thwarted the argument that it is a job killer,” Oliver said.

We don’t know the true impact, Brogan explained, because we don’t know how much of an increase we will see next year when the rate of inflation is calculated.

Not for commercial use. For educational and discussion purposes only.


TOPICS: Business/Economy; US: New Jersey
KEYWORDS: economy; jobs; minimum; wage
 

It's one thing to have representatives vote to increase the minimum wage. But stupid New Jersey voters allowed the politicians to become completely unaccountable on this issue by making the raise automatic each year. Ugh.

 

1 posted on 07/21/2014 9:27:34 AM PDT by Incorrigible
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To: Incorrigible

No, they simply kill future hiring....

at the “best”.....


2 posted on 07/21/2014 9:30:24 AM PDT by GraceG (No, My Initials are not A.B.)
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To: Incorrigible
“Honestly it’s too early to tell”...Really? So If Mickie Ds has to raise their minimum salary....they raise their overhead, stop turning a profit and go out of business. Wait...sorry...we'd have to do math then!
3 posted on 07/21/2014 9:32:04 AM PDT by gr8eman (Bill Carson...meet Arch Stanton!)
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To: Incorrigible

“CEPR acknowledges this analysis is far from scientific and draws no direct link between raising the minimum wage and payroll gains. Still, “it does provide evidence against theoretical negative employment effects of minimum wage increases,” CEPR researcher Ben Wolcott writes.”

So, the author of the study admits it proves nothing.

Tiny increases in minimum wage have very, little effect, either positive or negative, as very few people are affected.

Massive increases like the $15.00/hr rate coming to Seattle will kill thousands of jobs, and would kill millions if implemented nationally.


4 posted on 07/21/2014 9:33:28 AM PDT by Above My Pay Grade (The people have the right to tell government what guns it may possess, not the other way around.)
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To: Incorrigible

I have an idea....let’s raise the Minimum Wage to $47.50 an hour. By this logic it will quickly drive unemployment down to 2%.


5 posted on 07/21/2014 9:33:56 AM PDT by Buckeye McFrog
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To: Above My Pay Grade

bump


6 posted on 07/21/2014 9:36:13 AM PDT by GeronL (Vote for Conservatives not for Republicans)
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To: Incorrigible
A new study by the Center for Economic and Research Policy

no mention that this is a liberal/progressive group....hmmm. A conservative group would undoubtedly be identified as such.

7 posted on 07/21/2014 9:38:59 AM PDT by BookmanTheJanitor
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To: Incorrigible

All this legislation does is devalue the purchasing power of the dollar and affixes a continuous inflationary sprial on it which causes the coin of the realm eventually to become valueless.


8 posted on 07/21/2014 9:40:39 AM PDT by mosesdapoet (Serious contribution pause.Please continue onto meaningless venting no one reads.)
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To: Incorrigible

Because we all know it’s a fundamental law of economics that increasing the cost of something has no effect on the demand for that thing.


9 posted on 07/21/2014 9:41:22 AM PDT by circlecity
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To: Incorrigible

Just like the Democrats unfunded mandates are intended to tie up State funds to cause the States to be more vulnerable to Federal financial assistance, manipulation, and ultimately control, so is the Democrats minimum wage scheme.

Be minimum wage Democrat instigators Federal, or State it doesn’t matter as it’s always the Democrats, and their intent is to assault capitalism by driving up costs.


10 posted on 07/21/2014 9:42:46 AM PDT by rockinqsranch ((Dems, Libs, Socialists, call 'em what you will. They ALL have fairies livin' in their trees.))
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To: Incorrigible

The CEPR is a total leftwing, pro-union, anti-business, Occupy Wallstreet, special interest group.


11 posted on 07/21/2014 9:46:36 AM PDT by KC_Conspirator
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To: Incorrigible

Figures may not lie but liars figure.


12 posted on 07/21/2014 9:47:57 AM PDT by mulligan (I)
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To: Incorrigible
"The Center for Economic and Policy Research (CEPR) is a progressive economic policy think-tank."

So if it doesn't cost jobs, why not make it $100? Why not $1000? (In reality, all a minimum wage does is make it illegal for anyone whose labor is not worth the minimum wage to work.)

13 posted on 07/21/2014 9:48:12 AM PDT by Sooth2222 ("Suppose you were an idiot. And suppose you were a member of congress. But I repeat myself." M.Twain)
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To: Incorrigible
If you consider the economics a loss of jobs is inevitable. Consider a worker making $10 per hour. That worker must produce at least $10 of revenue per hour worked just to pay their wage and more if you consider other costs of production. If you raise the wage, productivity must be increased to produce the added revenue per hour needed to pay the wage increase. Worker productivity can be increased by automation making workers more productive per hour worked, but that often means fewer workers will be needed. Productivity can also be increased by reducing the number of workers. For example, replacing part time workers with fewer full time workers.

Keeping all variables the same but just increasing wages can also be accomplished by increasing prices. However, in a competitive market that may not be possible. For example it might be more efficient to just move production offshore where labor costs are cheaper and keep prices competitive.

Some will argue that businesses just cut profits to pay higher wages. However on average businesses make only about 6% profit on a dollar of sales and much less in many businesses. For example grocery stores operate at a profit level of about 1%. Again liberals will maintain even that even that level of profit is "excessive", but fail to realize that businesses do not work on a break even basis as entrepreneurs will not accept the risks of operating a business with no potential of economic profit.

The bottom line is that increasing wages above reasonable productivbity levels will result in fewer jobs.

14 posted on 07/21/2014 9:51:33 AM PDT by The Great RJ
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To: mosesdapoet

All this legislation does is devalue the purchasing power of the dollar and affixes a continuous inflationary sprial on it which causes the coin of the realm eventually to become valueless.


A person projected into our time from the year, say, 1880 would say that has pretty much already happened.


15 posted on 07/21/2014 10:00:45 AM PDT by cuban leaf (The US will not survive the obama presidency. The world may not either.)
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To: Incorrigible

“Study: Minimum wage hikes don’t kill jobs”

However, it DOES kill customers who cannot afford the price hikes.


16 posted on 07/21/2014 10:07:01 AM PDT by stars & stripes forever (Blessed is the nation whose God is the Lord.)
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To: Incorrigible

Progressive think tank talking points, never listen to any think tanks talking points, conservatives either, they both have an agenda and are propagandists. If you really need proof of something go directly to the source where ever that might lead!!!


17 posted on 07/21/2014 10:07:14 AM PDT by qman (The communist usurper must go!)
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To: Incorrigible
It is a no brainer because that money was going to immediately be coming right back into our local economy,

If I take $500 out of the cash drawer at a supermarket and turn around and buy $500 of groceries with it, the grocer -- or the local economy -- is not better for it.

18 posted on 07/21/2014 10:12:53 AM PDT by BfloGuy ( Even the opponents of Socialism are dominated by socialist ideas.)
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To: circlecity
Because we all know it’s a fundamental law of economics that increasing the cost of something has no effect on the demand for that thing.

The fundamental law of economics (i.e. the Law of Demand) states that increasing the cost of something will decrease the QUANTITY DEMANDED of that good; however a change in price does NOT have any effect on the DEMAND for the good. Demand is the relationship between price and quantity demanded. In other words, Demand is the entire line -- or curve -- on the graph rather than just points on the curve. An increase or decrease in demand means the quantity demanded changes at every price. When you change the price, the curve does not shift; you just move to a different point on the curve. Thus, an increasing price does NOT have any effect on the demand for that thing, only an impact on the quantity demanded.

Things that have an effect on the demand for a good (i.e. Determinants of Demand) include:
Changes in Income and Wealth of buyers in the market,
Changes in price or availability of substitute goods,
Changes in price or availability of related goods,
Changes in the number of buyers in the market,
Changes in demographics and consumer tastes, etc.

Changes in these factors impact the quantity demanded at every price and therefore cause the entire demand curve to shift to the left (decrease) or right (increase).

This brief refesher from Basic Economics 101 is brought to you by the letter "D" (for Demand).

19 posted on 07/21/2014 10:13:08 AM PDT by VRWCmember
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To: BfloGuy

bump


20 posted on 07/21/2014 10:14:29 AM PDT by GeronL (Vote for Conservatives not for Republicans)
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To: BfloGuy

This “study” is pure, 100%, unadulturated CRAP


21 posted on 07/21/2014 10:15:08 AM PDT by GeronL (Vote for Conservatives not for Republicans)
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To: gr8eman

Use Common Core math and you can make it work.


22 posted on 07/21/2014 10:26:10 AM PDT by Portcall24
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To: Incorrigible

Perhaps the minimum wage rate hasn’t caught up with the market rate?

I haven’t read the report, but what percentasge of wage earners are paid at the miminum wage - less than 5%?

That could influence the lack of effect on overall payrolls.


23 posted on 07/21/2014 10:30:42 AM PDT by ADSUM
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To: ADSUM

Union contracts are tied to the minimum wage.


24 posted on 07/21/2014 10:35:19 AM PDT by dfwgator
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To: Above My Pay Grade

Good Point- this is a stupid study. Obama plays the same game when he makes statements that increasing the Minimum wage does not have widespread impact on unemployment. This is true, but unfortunately, increasing the minimum wage has the most serve and DIRECT impact on the people increasing the minimum wage is supposed to help.


25 posted on 07/21/2014 10:50:45 AM PDT by 11th Commandment ("THOSE WHO TIRE LOSE")
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To: Incorrigible

Selection bias.


26 posted on 07/21/2014 10:55:59 AM PDT by Born to Conserve
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To: Incorrigible

Further to my post #10 as repeated here: “Just like the Democrats unfunded mandates are intended to tie up State funds to cause the States to be more vulnerable to Federal financial assistance, manipulation, and ultimately control, so is the Democrats minimum wage scheme.

Be minimum wage Democrat instigators Federal, or State it doesn’t matter as it’s always the Democrats, and their intent is to assault capitalism by driving up costs.”

I would like to point out that it’s NOT unlike the Cloward-Piven scheme.


27 posted on 07/21/2014 11:05:45 AM PDT by rockinqsranch ((Dems, Libs, Socialists, call 'em what you will. They ALL have fairies livin' in their trees.))
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