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DiMaso and O’Scanlon: $15 minimum wage will be net loss for low-income workers

Senator Declan O’Scanlon and Assemblywoman Serena DiMaso, both R-13, today warned that the Democrats’ plan to raise New Jersey’s minimum wage to $15 per hour will have net negative consequences for low income wage earners.

The bill to raise the wage to $15 in increments and with exceptions by 2024 passed in committee in both the Assembly and Senate today.  It is scheduled to be voted on in both chambers on Thursday.

“The impact this minimum wage legislation could have on the State budget, and further, the entire State economy, cannot be understated here. The Senate President confirmed today that the cost is anywhere from $300 to $600 million on the budget. How can we possibly talk about adding that kind of expense to our budget when we already have a massive budget hole? It’s irresponsible,” O’Scanlon said.

“A large number of these residents are reliant on programs like Medicaid, food stamps, and utility assistance. If you rapidly increase someone’s pay to $10 an hour in the next year and assume there isn’t any impact to their number of hours or job safety, something we know will happen due to the devastating impact on small businesses, then those workers won’t be eligible for lower cost health benefits through the Medicaid expansion,” DiMaso added.

New Jersey chose to maintain the Medicaid expansion which helped more than 500,000 residents keep access to healthcare, many of whom are minimum wage workers. The federal government largely holds authority over the income guidelines for Medicaid along with other benefits programs like SNAP and LIHEAP/USF.

“Any increase to their income is going to be eaten up by their net losses from Medicaid and other assistance programs. You can do the simple math here and realize a $2-per-hour increase gives a full-time worker another $300 a month before taxes. Maybe, they now need $100 a month for health insurance, because they lost $100 from food stamps, and $50 from utility assistance. After taxes they are still going to be struggling to pay their bills and could possibly be worse off financially than they were before. You’re going to wind up with even longer lines at food pantries if you aren’t careful,” O’Scanlon added.

“This is indicative of what happens when you don’t fully-engage with all stakeholders before trying to get legislation passed quickly,” DiMaso added. “Having families kicked off Medicaid and utility assistance, and even potentially lose housing, while we wait for years for the federal government to consider changing eligibility for these programs isn’t helpful. This is adding to the growing number of struggling middle class families who can’t afford to pay their bills but aren’t eligible for the short-term helping hand they might need to get by. Food banks across the state have been stretched thin as middle class families struggle to make ends meet under constant new tax burdens.”

“We should also consider the community of developmentally disabled residents who take positions at supermarkets and other businesses to earn money and increase socialization time,” O’Scanlon continued. “The food industry has indicated that these positions would wind up being eliminated, or the hours severely reduced. Furthermore, all of our service providers for the mentally ill, developmentally disabled, and addicted have made it clear they would be devastated by this if we don’t simultaneously increase their funding-yet another tax increase on the backs of our already beleaguered taxpayers. There are so many potential net losses here that haven’t been properly discussed.”

“We will always be in favor of residents being able to support themselves without having to rely on safety net programs, however, this just shows that leadership is pushing a bill through that could harm the very people they claim to want to help,” DiMaso said. “This increase could potentially bankrupt community provider organizations and leave a massive service void for these struggling families that volunteers and charities alone cannot handle. We’re already taxing our residents out of the state, we can’t add another nail to that coffin.”

“I serve on the State Manufacturing Caucus, and this legislation coupled with last year’s tax increases and further sick leave mandates goes against everything that we’ve heard from critical employers as we’ve traveled around the state. We have local businesses in our district, like one of the finest Irish pubs in the state, that our absolutely terrified about their operational capacity as a result of this potential increase. When attempting to help lower income residents who are struggling, the Senate Majority must consider the large scale consequences that could hurt the very same people they are trying to help. Ramming through legislation without having these important discussions is a recipe for disaster.” O’Scanlon concluded.

 

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Posted: January 28th, 2019 | Author: | Filed under: Monmouth County News, New Jersey | Tags: , , , , , | 8 Comments »

8 Comments on “DiMaso and O’Scanlon: $15 minimum wage will be net loss for low-income workers”

  1. David said at 9:03 am on January 29th, 2019:

    Do not forget about earned income credit for families with children. In a certain range, each $100 of salary increase will case the taxpayer to lose $21 of earned income credit. Plus the New Jersey EIC. The increase will also cause a reduction of Obamacare subsidies if they are on that program. So I think that the result of the increase is that: (a) employers will look to reduce the hours of staff because of increased costs; and (b) employees will look to reduce their hours because of the loss of EIC and other subsidies.

  2. Proof that said at 10:52 am on January 29th, 2019:

    creeping socialism creates the conundrum: we have made it too easy to get on,and stay on, all forms of public assistance: therefore, it will be nearly impossible to pull people off these ever- expanding programs. And, therefore, to increase the debts and deficits. When we make it more profitable to not-work, this is what we get.

  3. Angry Taxpayer said at 11:25 am on January 29th, 2019:

    He should have thought that way when he voted to raise the gas tax. The gift that keeps on taking.

  4. Yup. said at 2:46 pm on January 29th, 2019:

    When I suggested that they stop with the platitudes, and actually demand a full audit of all NJ Transit budgets, and a five- year naintenance/replacement plan, I was told it was an interesting idea. Waiting to see if it actually happens. Meanwhile, we are all growing older and grayer, as we wait to see any actual fixes to the deteriorating roads and bridges, this confiscatory tax was supposed to be dedicated to. “ Paying off old bonds” doesn’t cut it, folks: and, one wonders why people are giving up and finally leaving Blue Jersey in droves?? These are two big reasons, right here!!

  5. Declan said at 8:36 pm on January 29th, 2019:

    has always been a RINO.

  6. Steve Adams said at 12:19 pm on January 30th, 2019:

    Good work Declan and Serena. At least two elected official understand the ill conceived and dangerous precedent set by government interference in the free market.

    People are paid what they are worth or can find another job that will pay them what they are worth. Thats the free market at work. When the government forces pay above the value an employee provides, the employee will be replaced and unemployed as quickly as the business can change the business model. Every time you order food at a McDonalds on a computer screen instead of from a kid or a senior citizen you should curse the minimum wage.

    If you want to improve upward mobility there is only one way. Increase the value a person can demand for employment. This is done by fixing education, training, and reducing regulation to allow the free market to work, and employees to develop their marketability.

  7. I have to know said at 12:12 am on January 31st, 2019:

    what the Senator considers one of the finest Irish pubs in the state.

  8. Dublin House, RB? said at 9:52 am on January 31st, 2019:

    Kelly’s, NC? Irish Pub, AC? Lots to choose from…