State lawmakers seek to tie minimum wage to CPI

ALBANY — In a move aimed at helping the lowest paid workers cope with the rising cost of living, two influential Democrats are building support for a measure that would tie New York’s minimum wage to the consumer price index.

The measure would require the state commissioner of labor to announce upstate wages increase with the rate of inflation once the upstate minimum wage reaches $15 an hour.

The upstate minimum wage is currently $13.20 per hour. The federal minimum wage is $7.25 per hour, and has remained at that level since 2009.

“Historically, yearly gains in inflation have decreased the value of the minimum wage, chipping away at workers’ purchasing power and leading to hardship for many,” the bill sponsored by Sen. Jessica Ramos, D-Queens, states.

Those who rely on the minimum wage jobs tend to be women and people of color, “groups which also face significant barriers to employment,” the bill explains.

But a new report from the Empire Center for Public Policy, a conservative think tank, contends employers are likely to react to a mandatory increase in New York’s wage floor by trimming their workforce.

“If you’re an employer, to make the math work, you’ve got to have fewer employees,” Peter Warren, the author of the analysis, said in an interview. “You’re going to let go of those employees who are the least skilled and the least educated. So the upshot is the people who are disproportionately impacted are the very people Senator Ramos and others are saying they are trying to help.”

The legislation also has a majority conference sponsor in the Assembly — Assemblywoman Latoya Joyner, D — the Bronx.

According to the bill, 16.4% of New York’s workforce — roughly 1 million people — earn the minimum wage. Legislation approved by state lawmakers in 2012 and signed into law by then Gov. Andrew Cuomo began to raise the minimum wage in steps, with three different pay floors in three regions of the state. The minimum went to $15 an hour in New York City in 2015.

The upstate wage is on track to keep increasing until it reaches $15 an hour, with inflation and other indicators taken into account in the calculations made each year.

The measure suggests that if the bill is enacted workers won’t have to worry about whether the lawmakers will sign off on adjustments to the minimum wage each year.

“By joining more than a dozen other states that have tied minimum wage to inflation, minimum wage workers in New York State will maintain their purchasing power without yearly legislative action,” the legislation states.

Small businesses across the state were surveyed on their views of indexing the state minimum wage to the inflation rate, said Ashley Ranslow, state director of the National Federation of Independent Businesses.

“The vast majority of small businesses came back and said, ‘No,'” said Ranslow, explaining that businesses are not in a position now where they can readily absorb the costs of a more expensive payroll.

“We’re in a 40-year, record high inflation, which is really putting substantial pressure on small businesses,” she said.

“They see the cost of all of their goods and services go up exponentially. So if you add labor costs on top of that, you put them in an even more difficult position. Sometimes I think what gets lost is that a lot of lawmakers think businesses can just pay people more. But it doesn’t work that way. They have to be able to offset their costs somehow,” she added.

The measure is expected to be considered when lawmakers return to the statehouse in January. Both legislative chambers are dominated by Democrats.

A coalition of labor and progressive groups has formed Raise Up NY to push for the bill’s passage. It argues families can’t make ends meet on New York’s current minimum wage as inflation shrinks the buying power of consumers.


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