ALBANY — A Cuomo administration report to be released Thursday gives the green light to minimum wage increases slated to go into effect next year — including the expansion of $15 an hour pay in the five boroughs.
New York’s low unemployment numbers, economic expansion in the state’s leading industrial sectors and a moderate national economic slowdown mean the planned pay increases scheduled for 2020 shouldn’t be a problem, according to the report, penned by Cuomo budget director Robert Mujica.
“Although the economic forecast is not without risks, the current outlook for continued growth in employment and wages at a moderate pace should allow the State labor market to absorb the minimum wage increases scheduled for 2020,” Mujica writes.
That means employees at city businesses with 10 or fewer workers will join those at larger companies and fast-food workers in earning $15 an hour starting Dec. 31. On Long Island and in Westchester, the minimum wage will rise to $13 per hour. The wage in the rest of the state will increase from $11.10 to $11.80 an hour.
The report champions New York’s low unemployment rate, which fell to 3.8% late last year and has remained around 4% through most of 2019. It also notes that household income in the state rose 2.5% in 2018 compared to a nationwide increase of 0.8%, according to the U.S. Census Bureau.
The percentage of part-time workers is projected to drop from 52.1% a decade ago to 41.2% next year while the age of the minimum wage workforce has gotten older and is more likely to be working full time, according to the report.
The percentage of workers between 16 and 24 is expected to drop to 31.3% in 2020, compared to 41.4% in 2009.
Opponents argue that hinging the increases on unemployment numbers is misleading.
“New York State has regional economies that are vastly different,” said Ken Polasky, vice president of government affairs for the Business Council of New York. He argues that population declines across the state mean that some counties are “losing people as quickly as they are losing jobs.”
Other opponents have expressed fears that raising the minimum wage would cause workers to lose jobs and prompt restaurants, retail stores and fast food joints to raise prices.
Mujica’s assessment, which is mandated to assess whether increases move forward as scheduled or if there should be a delay, is backed by several studies that show jobs have not been lost as a direct result of New York’s gradual rise in wages from $7.25 starting in 2009.
“New York is leading the fight for economic justice, proudly setting a national example by raising the minimum wage,” Cuomo said. “Nearly three years after the first minimum wage increase went into effect, we are seeing the benefits all across the state as we’ve achieved record low unemployment rates, fewer people living in poverty, more individuals working full-time jobs and more families now have the opportunity to live a decent life.”
Despite the glowing report, Cuomo has admitted one negative side effect of the minimum wage increase has been its contribution to an uptick in Medicaid spending, which in turn has resulted in a budget hole for the coming year that stands at $6.1 billion.
Polasky said businesses are facing a similar situation with rising labor costs.
“They have hard decisions to make,” he said of lawmakers trying to come up with ways to close the budget gap. “It’s the same kind of thing employers are facing when they see increases in operational costs.”