NFIB on Minimum Wage: Who Really Benefits?

Date: October 07, 2013


Trenton (October 7, 2013) –According to the union-backed Raise the Wage campaign, which wants to write automatic annual pay raises into the Constitution, there are 241,000 people in New Jersey who are “directly affected” by the minimum wage.  But according to the federal Bureau of Labor Statistics (BLS), the real number is only 49,000.  The National Federation of Independent Business (NFIB) today said the public deserves clarification.


“There’s a real discrepancy between what they’re claiming and the federal statistics and that needs to be explained,” said NFIB Director Laurie Ehlbeck.   “Voters are being asked to change the state constitution, which means it’ll be almost impossible to undo this if it passes.  They deserve to have accurate information.”


Raise the Wage appears to have exaggerated other information as well.  On its website the campaign claims that the minimum wage “affects single working parents and working class families.”  How many?  The campaign doesn’t say.  According to BLS figures for 2012, only 1.2 percent of all hourly paid workers over 25 are earning minimum wage.  Among men over 16 in hourly jobs, only 1.5 percent are making minimum wage.  Only 2.6 percent of women in the same category are making the minimum.  In New Jersey, where wages are higher, those figures are probably smaller.


“They’re creating a fictional New Jersey in which the typical minimum wage worker is a struggling single parent.  Based on the official statistics that cannot be true,” said Ehlbeck. 


There’s one fact that is conspicuously missing from the Raise the Wage website and it’s hard to find anywhere else:  What percentage of full-time union workers in New Jersey are making minimum wage?  According to BLS, roughly half of one percent of all full-time hourly workers in America earns the minimum wage.


That raises another question, said Ehlbeck.


“Why are the unions so heavily invested in a campaign that directly affects only a tiny handful of their own members,” she asked.


That’s a good question for which data doesn’t seem to be available.  But according to the New Jersey Department of Labor and Workforce Development, the average dishwasher makes $9.70 per hour.  That’s 33 percent more than minimum wage.  The average food preparation worker makes $11.20 per hour.  That’s 54 percent more than minimum wage.  Considering that union jobs typically pay more, there can’t be many union workers in New Jersey making minimum wage.


But it’s a question worth asking.  Big Labor is by far the biggest backer of the Raise the Wage Campaign.  A group called Working Families is bankrolling the campaign in New Jersey.  Its website lists a roster of partners that is dominated by unions.  The Raise the Wage official campaign website shows a similar list with dozens of labor groups and union locals and very few other types of organizations.


“Business groups have been very direct in explaining how this will hurt businesses.  But the Raise the Wage campaign seems to be avoiding any conversation on why the unions want this so badly,” said Ehlbeck.  Why are they pushing hard for a constitutional amendment that doesn’t appear to benefit unions directly?  Are the unions acting as philanthropic organizations, or do they have something to gain?”


It could be that many union contracts are now, or certainly will be if the question passes, pegged to the minimum wage.  So automatic annual increases in the minimum will mean automatic annual pay hikes for union workers and very likely higher dues as well.


“That would certainly explain their enthusiasm for a constitutional amendment that affects hardly any of their members directly,” said Ehlbeck.  Question #2 would essentially turn the Constitution into a labor contract.”


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