In Minimum Wage Wars, Public Workers Often Benefit First
Many governors and mayors are struggling to raise the minimum wage for their jurisdictions. In the meantime, some are giving their own employees a raise.
Jersey City, N.J., Mayor Steven Fulop wants to increase the local minimum wage to $15 an hour, but he can’t. New Jersey law preempts cities from enacting their own minimum wage laws, so Fulop decided to change what is under his direct control: wage rates for the city's own workforce.
“I’m a big believer that it’s hard to advocate for something if you’re not doing it yourself," said Fulop.
So he signed an executive order last week that will result in about 500 Jersey City employees seeing an increase in pay. That's less than one-fifth of the total workforce, but crossing guards, 911 dispatchers and other people in lower-skill positions will be getting a raise.
Fulop isn't alone in giving public employees a raise.
Last year, New York Gov. Andrew Cuomo ordered the minimum wage for state workers to increase to $15 over the next few years -- making it the first state to do so. The idea of raising the minimum wage to $15 for all employees in New York has met resistance in the legislature.
On Monday, Pennsylvania Gov. Tom Wolf signed an executive order guaranteeing that state workers will be paid at least $10.15 an hour. Wolf's order will also cover employees of state contractors who spend at least 20 percent of their time performing work on commonwealth contracts.
Wolf called on legislators to raise the statewide minimum wage, which now stands at $7.25 an hour.
"An increase in the minimum wage will lead to increases in employee morale, productivity and quality of work, and decreases in turnover and the cost of training and supervision," he said in a statement.
There's precedent for using government employee pay hikes as groundwork for raising the minimum wage more broadly. In 2014, Seattle Mayor Ed Murray signed an executive order creating a $15 minimum wage for municipal employees. Last year, Seattle adopted a $15 minimum wage for all employees, which is being phased in over several years.
The wage hike in Jersey City will cost about $1 million annually. The increase went into effect as soon as Fulop signed the order on Feb. 29, and it impacts both full- and part-time workers. Summer interns who are under 18, however, will be exempt.
Hiking the minimum wage for public employees isn't without its critics. Diana Furchtgott-Roth, an economist and senior fellow at Manhattan Institute, a right-leaning think tank in New York, said that Fulop's decision to boost wages for civic workers will drain money that could better be spent on crime or school programs.
"The mayor is doing this for the public relations and to say he’s doing something to raise the minimum wage," she said. But since it only applies to government workers, she conceded, "in terms of affecting the businesses or driving businesses out, it probably will not have much effect."
Democratic legislators in New Jersey are considering proposals to raise the statewide minimum wage to $15, something both Fulop and Newark Mayor Ras Baraka have endorsed. A study last year by the United Way of Northern New Jersey found that a single adult needs at least $13.78 in hourly wages to cover basic living expenses in New Jersey. The current minimum wage in New Jersey -- $8.38 an hour -- was approved by voters in 2013, following a pair of Christie vetoes of similar legislation. If Republican Gov. Chris Christie vetoes this legislation, proponents could put the measure on the November ballot.
By contrast, backers of a ballot measure to raise Oregon's minimum wage to $15 pulled the plug on the effort on Monday after Gov. Kate Brown signed legislation last week that will raise the minimum wage to $14.75 in the Portland area, $13.50 in smaller cities and $12.50 elsewhere.
No state has a minimum wage as high as $15 for all employees. California and Massachusetts require employers to pay at least $10 an hour and the District of Columbia's minimum wage is $10.50. Although President Obama has sought a higher federal minimum wage, his proposals have met resistance in Congress, leaving the national minimum wage at $7.25.