Gradual introduction of $ 15 minimum wage continues as labor shortages push wages up

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* Future increases will be based on an indexed schedule to be set by the Director of the Budget Division in consultation with the Ministry of Labor following an annual impact review. (Source: New York State Department of Labor)

NOTew York p minimum wage of $ 15hase-in will continue with the nadditional step taking effect on December 31 of this year.

The announcement follows a requested report from the State Budget Division which found “evidence of pressure for wages to rise amid a labor shortage due to a pandemic” , announced the New York State Department of Labor in late September.

The director of the Budget Division, working with the state labor commissioner, determined that the minimum wage should increase to $ 13.20 an hour in most states based on factors and indices economic.

The minimum wage will rise to $ 15 an hour in Long Island and Westchester County, corresponding to the hourly minimum of $ 15 already set in New York.

“Businesses, especially those employing low-wage workers, are already raising wages and in some cases offering hiring incentives amid a labor shortage that shows no signs of abating. , and it makes sense to raise the wage floor now and continue to support New York Families while providing a predictable path for businesses, ”said New York Department of Labor Commissioner Roberta Reardon , in a press release.

The report produced by the Budget Division is required by the state’s minimum wage law to examine the state of the economy and determine whether increases are progressing as planned or should be delayed.

For 2021, the law also requires the Director of the Budget Division to assess economic factors and determine, with the labor commissioner, the rate of increase in the minimum wage outside New York City, Long Island and the United States. Westchester County.

As the report describes, the minimum wage in this region is determined to increase based on the consumer price index for all urban wage earners and office workers as well as labor productivity in non-farm enterprises. It allows low-wage workers to continue to afford the same basket of goods and services, if not some, on the basis of increasing productivity.

Findings of the minimum wage report

The Budget Division’s minimum wage report found the low-wage sector to be “hardest hit” by the pandemic. One million jobs lost, or 57.2% of private sector losses, occurred in the three industries where minimum wage workers are most concentrated: retail, health care and social assistance, leisure and hospitality .

These sectors accounted for only 42.5% of private employment at the pre-COVID peak of February 2020. In just two months, the low-wage sector lost 31% of its jobs.

The report also found that the results of the Consumer Expectations Survey, compiled by the Federal Reserve Bank of New York, suggest the pandemic has caused some workers to reassess the value of their work.

The survey asks workers for the lowest wage they would accept in the field of their choice, called the reserve wage. The results of the survey indicate that the reservation wage nationwide hit an all-time high of $ 71,400 in March 2021, an increase of 15.7% from March 2020. Even though it has fallen in July 2021, it remained high over a two-year period, indicating “particularly strong growth” in reserve wages among the less educated and young workers.

Additionally, the report found that the Conference Board’s online index of requests for help is showing job openings statewide at record levels.

The total number of vacancies for July 2021, the most recent month available, has surpassed the pre-pandemic peak of March 2020 by 72.4%. The shortage of low-skilled / low-paid labor appears to be to be “even more serious”.

July publications specifying a high school diploma or vocational training are 95.4% above their pre-pandemic peak of March 2020. In addition, publications specifying either a high school diploma or vocational training represent 29.9% of total posts for July 2021, just below its all-time high in May 2021 of 31.6%.


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