NEW YORK — New York State could raise the minimum wage annually in line with inflation, using a rate determined by the Northeast Consumer Price Index of wages.
The proposal is expected to benefit hundreds of thousands of minimum wage workers across New York State. The Democrat also unveiled a new set of initiatives that will modernize and simplify the state’s proven workforce development infrastructure to ensure New Yorkers have the skills they need to thrive in today’s economy and help rebuild a modern workforce in public sector.
“If we are truly going to address the affordability crisis head-on, we need to recognize that low-wage workers in New York have been hit hardest by the rising cost of living,” Governor Hochul said. “Our common-sense plan to set the minimum wage in line with inflation will not only put more money into the pockets of hundreds of thousands of hard-working New Yorkers, but it will also provide predictability for employers and spur more spending on local economies and businesses”.
The Governor’s proposal would increase the state’s minimum wage due to year-over-year growth in the Consumer Price Index for Salaried Employees (CPI-W) for the Northeast region. To ensure that no annual increases threaten employment, annual increases would be limited. Furthermore, the proposal would also allow for an “exit ramp” in case of certain economic or budgetary conditions.
Indexing the minimum wage to inflation will help maintain the purchasing power of workers’ wages year after year. And while raising the minimum wage would benefit all low-wage workers, it would particularly benefit women and people of color who make up a disproportionate share of minimum wage workers.
Seventeen other states currently link their minimum wage to inflation or some other economic formula or are planned to, including three states that have minimum wages of $15 or more by 2023. Economic research shows that increasing the minimum wage it can lead to poverty reductions, reduced welfare spending, stimulus spending, improved worker productivity, and other benefits.
Last year, the Governor announced an increase in the minimum wage for counties outside of New York City, Long Island and Westchester to $14.20 an hour. He also secured a minimum wage increase for home health assistants as part of the FY 2023 budget.
Modernization and rationalization of state infrastructure for training and employment
The Governor also seeks to transform the New York State Department of Labor (NYSDOL) Career Centers into Community Career and Training Centers, a one-stop shop for New Yorkers looking for new job opportunities. In these revitalized centers, additional job skills trainers will provide unemployed and underemployed New Yorkers with free training in high-need areas such as digital and financial literacy and entrepreneurship. This will be combined with a new large-scale on-the-job training program to upskill thousands of workers each year, targeting high-demand sectors and hard-to-fill job titles.
Rebuilding New York’s public workforce
Democrat Hochul also outlined a plan to improve New York State’s civil service system to rebuild the public sector workforce to address a shortage of more than 15,000 workers, with more than 26 percent of the state workforce skilled to retire within the next five years.
A study update.
