The new minimum wage will mean the death of many NJ businesses (Opinion)
In a state where small business owners are already some of the most put upon in the country, the new $14.13 minimum wage that takes effect on Jan. 1 could be the nail in the coffin of many businesses.
Its potential impact on small businesses here in NJ is almost scary.
Some argue that increasing the minimum wage will help workers and stimulate the economy, but overriding any benefit, it will put a strain on small businesses and potentially lead to job losses.
One concern by many local NJ businesses about raising the minimum wage is that it will increase labor costs for small businesses.
Many small businesses already operate on tight budgets and may not have the financial flexibility to absorb the added cost of higher wages.
This could force them to raise prices, reduce staffing levels, or even shut down.
And after the diffuser few years, they’ve just had, this could be a death knell.
Another potential issue is that the increase in labor costs could make it difficult for small businesses to compete with larger, more established companies.
Larger companies may have more resources and be better able to absorb the added cost of higher wages.
This could lead to a situation where small businesses are unable to compete and, already hanging on to a thread, are forced to close, leaving fewer opportunities for entrepreneurship and job growth.
Additionally, a higher minimum wage could have negative impacts on the overall economy.
Higher labor costs could lead to higher prices for goods and services, which could in turn lead to inflation.
This could make it more difficult for individuals and families to make ends meet, potentially offsetting any benefits from the higher wages.
While increasing the minimum wage may sound good and “feel” good, it’s actually a perfect example of not seeing the forest for the trees.
Because, while it may have some positive effects for workers, it could also have negative impacts on small businesses and the economy as a whole.
Lawmakers treat minimum wage as though it is intended to support a family, but it was actually instituted for entry-level jobs.
The idea was to start at a minimum wage and then increase your salary at higher-paying jobs throughout the course of your life.
It’s a shame that NJ policymakers, didn’t consider — or, more likely, didn’t care about — the potential consequences of such a move before they implemented it.
Yet, here we are.
Opinions expressed in the post above are those of New Jersey 101.5 talk show host Judi Franco only.
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