NY Celebrated 'Bold' $15 Minimum Wage, Then Dem Policies Swiped $2 Off Value
Nearly four years after New York City’s minimum wage hit $15 per hour, that same wage is now worth just $13 per hour adjusted for inflation, The New York Times reported Monday.
That decline can be attributed to a roughly 15 percent dive in purchasing power per dollar in the city compared to late 2018, the Times reported, citing James Parrot, director of economic and fiscal policies at the Center for New York City Affairs at The New School.
The city’s minimum wage is set by the state’s legislative branch, and attempts to tie or adjust the minimum wage to inflation have been stonewalled by business interests.
“The $15 minimum wage was a bold, significant step in getting closer to a living wage,” Paul K. Sonn, state policy program director at the National Employment Law Project, told the Times.
Despite this, inflation is causing that wage to “fall far, far behind,” as inflation remains at near 40-year highs.
Businesses, however, oppose the hikes on the grounds that inflation is already hammering their costs, Vice President Ken Pokalsky of the Business Council of New York State told the Times.
More hikes would harm industries that rely on low-wage jobs and are still recovering from the pandemic, potentially incentivizing the automation of those jobs, Pokalsky said.
“Something’s got to give,” he told the outlet.
On the 10 year anniversary of the Fight for Fifteen, we’re stepping up to #RaiseTheWage and make sure it never falls behind again.
Join the #RaiseUpNY Coalition & me for our campaign launch
🗓Nov 15
⏰12 pm
📍City Hall pic.twitter.com/P9GoT1WymS— Jessica Ramos (@jessicaramos) November 14, 2022
Several other wage measures in the state are tied to inflation, including the minimum wage in some suburban and upstate communities, which the state tied to inflation due to a lower cost of living, according to the Times.
Rideshare apps, such as Lyft and Uber, are obligated to pay drivers a minimum rate that is tied to inflation and subject to regular review.
Hours after the NYT report, Democratic State Sen. Jessica Ramos of District 13 tweeted that she intended to reintroduce legislation that would raise the city’s minimum wage to $21.25 per hour by 2026 and tie it to inflation.
“Our minimum wage has fallen out of phase with the cost of living,” Ramos told the Times. “It’s not fair to leave New Yorkers behind.”
Raising the federal minimum wage incrementally from its current rate of $7.25 to $15 per hour by 2027 and tying it to inflation would result in roughly 750,000 fewer jobs per week in the country and roughly 300,000 fewer people in poverty, according to projections by the Congressional Budget Office.
The inflationary pressure of a national $15 per hour minimum wage would disproportionately increase prices at small businesses, which are less able to absorb costs, while large companies would raise prices less because of pressure by global or national competitors, according to a study by the Heritage Foundation.
“We look forward to working with our colleagues in Albany this legislative session to seriously consider raising the minimum wage while also recognizing that still-struggling small businesses may need financial help if they’ll be asked to pay workers more,” a representative for Democratic Mayor Eric Adams told the Times.
Adams previously characterized a 5.3 percent raise for rideshare drivers as being “about respect,” and providing drivers with “a fair and decent wage.”
Through October, the price of food in the New York, Newark and Jersey City area rose 8.6 percent on an annual basis, with the cost of groceries rising 10.4 percent, according to the Bureau of Labor Statistics. The cost of shelter was up 4.1 percent on an annual basis in October, growing 1.1 percent on a monthly basis compared to September.
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