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Report: Wage Hike Would Generate $1B, Create 7,300 Jobs
Posted By Jessica Bakeman On January 28, 2013 @ 12:03 pm In Other | Comments Disabled
A report Monday from the labor-backed Fiscal Policy Institute said Gov. Andrew Cuomo’s proposal for raising the state minimum wage would benefit 1.6 million New Yorkers and create more than 7,000 jobs.
Cuomo argued in his State of the State address Jan. 9 that a wage hike from $7.25 to $8.75 an hour “is the right thing to do” and included the measure in his budget presentation last week. Republicans and business groups have argued that the increased costs to employers would lead to jobs being eliminated.
In the report, the Albany-based group said full-time minimum wage workers would get an annual raise of $3,120, bringing their income to $18,200.
Raising the wage to $8.75 by July 2013 would lead to $1 billion in new consumer spending and generate 7,300 new full-time jobs as employers work to keep up with increase demand.
“New York’s minimum wage is decades out of date at this point and our state has suffered for it,” James Parrott, deputy director and chief economist at the Fiscal Policy Institute, said in a statement. “The Governor’s proposal will help low-wage workers recover some of the purchasing power the minimum wage has lost over the past four decades as the cost of living has steadily increased.”
The report argues that an eventual phase-up of the wage to $10 an hour would lead to $2 billion in new consumer spending and create nearly 15,000 jobs. A $10 hourly wage would bring full-time workers’ annual income to $20,800.
If minimum wage had kept pace with inflation since 1970, it would be $11.15 an hour, the report said. The Legislature did not increase the wage for two nine-year periods, from 1981 to 1990 and 1991 to 2000, it said.
The report shows that on average, the workers affected by the proposed wage increase contribute more than 43 percent of their total family income. More than 860,000 children across New York have a parent who will benefit from raising the state’s minimum wage to $8.75, it said.
“Low-wage jobs are stunting New York’s economic growth and fueling inequality,” Paul Sonn, legal co-director at the National Employment Law Project, said in a statement. “With wages continuing to stagnate across the state, raising the minimum wage is a smart way to boost consumer spending and deliver much-needed assistance to working families in New York.”
Read the full report here:
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