Gradual rise in minimum wage better for businesses, workers, Gov. Kathy Hochul says
Raising the minimum wage gradually is better for employers and employees, who are both burdened by ever higher prices, than a huge hike to $30 as New York City's new mayor has championed, Gov. Kathy Hochul told Newsday.
“I support where we are right now," the governor told Newsday on Friday when asked about Mayor Zohran Mamdani's campaign promise.
She said a 2023 state law had increased the hourly minimum over the past three years, and starting in 2027 additional increases will be determined by changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers for the Northeast Region.
The law provides needed "predictability" for businesses so they can make adjustments in their operations and pricing, Hochul said after speaking at a Woodbury breakfast organized by the Long Island Association business group.
Last week, the minimum wage on Long Island, in the city and in Westchester County rose from $16.50 per hour to $17. For comparison, in 2017, the minimum wage was between $10 and $11 per hour, depending on the size of the employer’s workforce, according to the state Department of Labor.
“To tie [minimum wage changes] to inflation, which kicks in next year — that's going to make a difference to people,” Hochul said in an interview on Friday. “They'll start to see that escalation as their costs go up, which I think is important in helping families who are struggling.”
Hochul added that she plans to work with Mamdani on other ways to ease the affordability crisis, particularly for minimum-wage earners. She cited a proposal, announced with Mamdani on Thursday, to provide free child care for children under age 5 across the state.
Hochul also has said she will include in her 2026-27 state budget proposal due later this month a provision to exempt tip income of up to $25,000 from state tax.
A Mamdani representative didn’t immediately respond to a request for comment.
Activist groups, such as One Fair Wage and the Living Wage for All Coalition, have also campaigned for the $30-per-hour minimum wage. The federal minimum wage has been $7.25 since 2009.
Business groups endorsed Hochul’s stance.
"At a time when affordability is our existential crisis, increasing the minimum wage more than 75% would not be sustainable for businesses — especially small businesses struggling to make their bottom lines,” Matt Cohen, the Long Island Association's CEO, said Friday.
Patrick Bailey, communications director for the Business Council of New York State, said sudden, large hikes in the hourly wage rate — to say $30 — don’t give employers sufficient time to alter their operations and to maintain cash flow. When wages go up so do payroll taxes and fees for unemployment insurance and workers’ compensation.
He added, “We do have to give businesses the opportunity to just catch up and adjust to this.”
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
