NJ votes for constitutional amendment raise min. wage to $8.25+ add automatic cost-of-living increases. What is your reaction?

It is probably not a good idea to write policy options into a constitution as these would be more wisely left to the legislature to change as circumstance requires. In that sense, putting the minimum wage increase into the state constitution is not much different than the folly of a balanced budget constitutional amendment. Constitutions should be about the structure, arrangement and functioning of the institutions of government, excepting the articulation of basic constitutional rights, and not about the policy options that government may choose to adopt over time. Writing specific policy options into a constitution then precludes adapting those policies to fluctuating circumstances. That all said, the effect of a minimum wage increase is less definitive that either its partisans or its opponents suggest. Typically, in an economic environment where price increases are more or less broad based across the economy, the effect of a minimum wage increase will be minimal. The rise in prices will tend over time to make the minimum wage inconsequential as business can offset the cost through price increases and wages will rise making the minimum wage effectively inoperative. On the other hand, in a low inflation or - worse still - a deflationary environment, a minimum wage will tend to increase unemployment, especially among the least skilled workers. Since prices are not rising, business cannot offset the wage cost through price increases and will thus avoid hiring - or even shed - those laborers whose productivity will not offset their cost. Over the long term this probably amounts to a wash, but at any given moment in time this could be very painful especially for low skilled workers during recessionary periods. Which, to repeat, is why it would probably be better if legislatures made the decision on the minimum wage as needed as opposed to making it inflexibly part of a state constitution. Again, it is analogous to the folly of a balanced budget amendment. Of course, there is also the problem at which the wage is set. A minimum wage set close to the prevailing wage rate will tend to have no effect - and be of no benefit to its recipients. Whereas a minimum wage set at $30 an hour would absolutely spark a rise in unemployment. (It would also probably spark an exodus of business from the state, too.) What New Jersey specifically is doing is setting a floor to wages as the COLA will be upped when the prevailing inflation rate goes up, but of course wages will not be similarly cut when prices fall. This will, as noted, tend to increase unemployment among the low skilled during recessionary periods. That said, in the end, it is really a values trade-off. The public, in effect, has decided to protect the wages of those already employed against those not employed, again particularly at the low end of the skill spectrum. That is a legitimate choice to make so long as the public is fully aware of the cost/benefit trade-offs involved. In terms of the low-skilled employed, this may help reduce, at least over the near term, their dependence on various public assistance programs. That in turn, again at least for a time, may net a budgetary savings. However, again for those unemployed, or for those with low skills who might lose their jobs during periods of recession, this will likely result in a longer period of unemployment and a concomitant expenditure on public assistance. That's the nub of it, and it is a wash over time. Statistically, by the time you factor out the wage increases against the fluctuations in employment, the standard of living as measured in the aggregate will be left little changed. Life is all about trade-offs after all but they are, as Burke said, more often about choices between good and good, or bad and bad, as they are about choices between good and bad.