City and state mandates, onerous work rules and excessive taxes continue to hurt the New York economy, according to several business experts.
These hindrances include scheduled increases in the state minimum wage, new city paid sick leave rules for small businesses, high construction costs and burdensome taxes.
“The first obstacle is the tax climate. And I think everyone would recognize that as being a huge obstacle in New York,” said Heather C. Briccetti, president and CEO of the Business Council of New York state. “Everyone recognizes it is a problem, but anytime you suggest tax reform, it becomes a contentious issue,” she said.
“New Yorkers shoulder the highest state and local tax burden in the country. The states that are growing the fastest are those states with relatively low taxes,” says Brian McMahon, executive director of the New York State Economic Development Council.
In addition to high taxes, hidden surcharges on energy are hurting the region’s economy, Briccetti added.
Small businesses were recently required, under a new city law, for the first time to provide workers with paid medical leave. Mayor Bill de Blasio, in signing the new rule into law, praised small-business owners, saying they “are very inventive” at coping with new rules and regulations.
“We’re hearing from our clients that it’s not as easy as that,” said Michael Trabold, director of compliance for Paychex,
Many small businesses, he said, are finding it hard to hire because of the new law. Trabold noted that scheduled minimum-wage increases (the state minimum wage is scheduled to hit $8.75 at the end of the year) is a frequent complaint of his clients.
“There is definitely a correlation between raising the minimum wage and a small business’ desire to hire new workers,” Trabold said.