Linda Doherty, president of the New Jersey Food Council (NJFC), praised the decision of New Jersey Gov. Chris Christie to veto legislation that would dramatically increase the minimum wage in the state to $15 per hour.
“We support the action by Gov. Christie in vetoing a 79 percent increase in the minimum wage that would have made New Jersey one of the highest required wages in the country. New Jersey’s food retail and distribution industry employs almost 200,000 workers annually, and our member companies operate on very slim margins. While the industry is committed to providing our employees with competitive wages and generous benefit packages, New Jersey food stores would be unable to afford such a drastic increase in labor costs without reducing staff, cutting hours and benefits, and raising prices on consumers.”
She cited research by Economists John Dunham & Associates, which conducted a comprehensive economic analysis of New Jersey’s food retail and distribution industry. The data shows that New Jersey has lagged behind national job growth, both in lower-skilled jobs and in total jobs in nearly every year the minimum wage was increased. Following the 2014 minimum wage increase, low wage job growth fell from 2.79 percent to 1.48 percent, down 1.31 percent.
“The data also reveals that a drastic minimum wage increase would lead to a significant increase in the price of groceries and other essentials,” she said. “The price tag of a $15 minimum wage in increased costs to consumers is nearly $294 million. Even more troubling is that seniors age 55 and above, many of whom are on fixed incomes, would bear 40 percent of these increased costs to the tune of nearly $125 million. Basic necessities would cost more, such as toilet paper, which would increase by 19 percent.
“Food retailers are the anchor of almost every New Jersey community, and our industry has an impact on the health and wellness of New Jersey residents. This forced increase would jeopardize new food retail investment and job growth, and would drastically raise prices for food and groceries for all New Jersey families. New Jersey was once the headquarters of supermarket giants Pathmark and The Great Atlantic & Pacific Tea Company (A&P), a combined 200 years in the grocery business. These stores recently filed for bankruptcy in 2015 after the last wage hike. While these companies had their struggles, the last forced wage increase was unsustainable. A significant minimum wage increase would further jeopardize established New Jersey food retailers that will find it difficult to afford the nation’s highest minimum wage.”
The author sites A&P and Pathmark for reasons not to raise the minimum wage. I would like to add that A&P and Pathmark have been in financial trouble for years but not because of wages. These 2 companies have been poorly managed from above and to say their failure is because of wages is totally unfair. Most of the New Jersey stores are Union and top wages exceed the $15.00 minimum wage. What this wage would affect is new hires and companies like Wal Mart that pay across the board are below that minimum wage. Raising the minimum wage would probably make the competitive situation more fair for the average Grocer that has a Union shop