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Cuomo Touts Wider Economic Benefit of Minimum Wage Increase

Mike Groll

As part of his budget plan, Governor Cuomo wants to raise the minimum wage to $10.50 across the state and $11.50 in New York City. He says raising the minimum wage doesn't just help workers on a personal level, it will also immediately impact the economy.

"You know, when you raise the minimum wage, the workers who receive the raise spend it. Why? Because they need it. They're literally living paycheck to paycheck. So you raise the wage, and it will be an economic stimulus because three billion dollars is a significant amount in the state economy."

Cuomo's "three billion dollars" is a number that comes from everyone in the state who currently works below the proposed wage increases.

But Kent Gardener, chief economist with the Center for Governmental Research, says it's more complicated than that. He says that number doesn't take into account the potential losses of a minimum wage increase. Gardner says some people could be laid off and some might lose hours. Increased wages could also accelerate some technological alternatives to living, breathing, laborers.

"I was in a Panera Bread in Waco Texas a couple of weeks ago and saw that there was, I think, about a half dozen kiosks - ordering kiosks - at the front of the facility. So you could go in and order your food and then go pick up your food without actually having to speak with anyone."

Gardener's "robots are going to steal your job" argument isn't a new one, but it's an example of his broader point. He says Cuomo's "three billion dollars" is an oversimplified answer to an incredibly complex problem. According to Gardner, it's not that a portion of the proposed wage increases wouldn't cycle back into the economy, it just won't be all three billion of those dollars.

Veronica Volk is a senior editor and producer for WXXI News.
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