Living Wage Study Says Policy Costs Jobs
May 9th, 2011
After much anticipation, the city Economic Development Corp. released a $1 million study on living wage policy today, which finds implementing higher pay standards at city subsidized developments would cost jobs.
The study examines legislation at the City Council to require any entity who recieves more than $100,000 in financial assistance from the city to pay a living wage. Thirty council members have signed on in support of the measure. Council Speaker Christine Quinn has not revealed her position. Although the speaker has Ok’d a hearing on the bill, which is scheduled for Thursday.
The adminsitration called for the study, which was conducted by Boston-based consulting firm Charles River Associates, last year after the City Council defeated a controversial development at the Kingsbridge Armory. The developer refused to guarantee tenants of the proposal would pay a living wage.
The study found certain development projects would no longer be “financially feasible” if the city adopted a living wage mandate. As a result, it argues, the city would lose jobs.
In response to the study, Andrew Brent, a mayoral spokesperson, released the following statement:
ďThe study is clear: the legislation would result in major job losses at all income levels and particularly among low-income New Yorkers. The biggest job losses would occur in the areas with the highest unemployment at a time when too many New Yorkers are without jobs as it is. The legislation would have a very harmful effect on growth opportunities of small businesses and the creation of affordable housing, and it would reduce overall private investment in New York City by an estimated $7 billion. Aggregate wages among low-skilled workers would not change because any gains among some workers would be more than offset by families losing employment opportunities entirely. The goal of increasing wages among New Yorkers of course is a good one, but this type of approach in other cities hasnít just failed, itís done so with severe consequences for job-seekers and businesses.Ē
But not everyone was thrilled with the results. In response to the study, Comptroller John Liu (a frequent critic of the Economic Development Corp.) released the following statement:
ďThe EDCís claim that a living wage kills jobs shows just how distorted the agencyís operations have become. The proposed living wage would be a requirement on new projects that are heavily subsidized by taxpayers. It may curtail the number of new minimum wage jobs, with the hope that these new jobs would then pay a decent wage. The claim of job losses is rhetoric at its worst.Ē
Asked what he thinks the study means for the living wage legislation currently under consideration at the City Council, Paul Sonn, legal co-director of the National Employment Law Project, still seemed optimistic.
“The council I’m sure will give it careful consideration,” Sonn said. “We expect them to look at more rigorous research, which includes other studies and hearing the real world experiences of other cities.”
And for your reading pleasure:By Courtney Gross on May 9, 2011, 6:11 pm
In category: City Hall, Community Development, Economy, Electoral Politics, Eye Opener, Gotham City, Governing, Land Use, Law, Measuring UP, Work and Labor, nextNY | 1 Comment »