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Proposal Would Provide Annual Cost-of-Living Increases to Airport Minimum Wage, Increasing Worker Retention and Improving Customer Service
Plan Follows Precedent Established by New York and New Jersey, Tying Minimum Wages to Consumer Price Index
Airport Stores and Restaurants Could Offset Increased Costs Through Proposed Revision to Concession Pricing Policy
TRENTON – Governor Phil Murphy and Governor Kathy Hochul on Nov 12th, announced a proposal from the Port Authority of New York & New Jersey for an expanded minimum wage policy at John F. Kennedy International, LaGuardia and Newark Liberty International airports that provides annual increases to the wages of thousands of airport workers starting in January 2025, with automatic increases tied to the regional cost of living, consistent with the minimum wage policies of the states of New York and New Jersey. The Port Authority Board of Commissioners last adopted an expanded minimum wage policy in 2018, which brought the wages of airport workers to a minimum of $19 per hour as of September 2023 but did not provide for any further increases without additional Board action.
“Our region’s airport system serves as one of the nation’s largest distribution and transportation hubs, but it is only as efficient as the men and women who work each day to keep operations running smoothly,” said New Jersey Governor Phil Murphy. “Airport work is a difficult and demanding job that deserves our recognition and our thanks, which is why I am pleased with today’s proposed per-hour wage increases and look forward to seeing them approved.”
“Today, we are taking a significant step forward in ensuring that the hardworking individuals who serve in the region's airports are paid fairly and equitably for their contributions,” said New York Governor Kathy Hochul. “This proposal guarantees annual wage increases tied to the cost of living, providing workers with the stability they need to thrive, while ensuring their pay rises alongside the economy. I will also be introducing an amendment to the Healthy Terminals Act during session next year to improve benefits for these workers. This is how we build a fairer, stronger New York for all.”
The new proposal provides for three upfront increases of $0.75 in January 2025, July 2025, and January 2026. Beginning Jan. 1, 2027, annual increases would be tied to the U.S. Bureau of Labor Statistics’ Consumer Price Index (CPI) three-year moving average for the Northeast region, consistent with the two states’ minimum wage policies. The proposal provides for the wage to automatically increase to $25 in January 2032 if that level has not already been reached through the annual CPI increases.
The wage increase for airport workers is highly beneficial in helping to attract and retain more skilled labor to airport businesses, leading to improved customer experiences within the airports. A fairly compensated airport workforce leads to reduced turnover, resulting in a well-trained and experienced workforce that can help to provide stable airport operations and an important supplemental security presence. Similarly, the Port Authority saw significant improvements in customer satisfaction following the previous minimum wage increases beginning in 2018.
Port Authority Chairman Kevin O’Toole said, “Our airports serve as international front doors for this region, as well as engines for economic opportunities benefitting the communities nearby. Consistent and planned wage increases for airport workers improve morale and productivity as well as the quality of service for the millions of passengers who use our airports every year.”
Port Authority Executive Director Rick Cotton said, “The proposal we put forward today reflects our recognition and appreciation for the airport employees who work hard to look out for tens of millions of travelers at our region’s airports. Ensuring livable wages will improve worker satisfaction and increase staff retention, in turn enhancing customer service and advancing our goal of a world-class airport experience from curb to concession to gate.”
To offset the added cost to businesses operating stores and restaurants at Port Authority airports, the Port Authority also proposed a revision to the agency’s policy that regulates concession pricing at the agency’s airports. The revised policy will allow concessionaires to charge prices to their customers at a level not to exceed 15 percent of the local, off-airport “street prices” for comparable products. This rate is consistent with several other U.S. airports that share similar regulations seeking to set rate ceilings and prevent price gouging. The Port Authority will also allow airport concessionaires to add an Employee Benefits and Retention surcharge not to exceed 3 percent of a customer’s pre-tax bill.
The permitted adjustments to pricing reflect the added costs of doing business in the airport environment, which include unique factors such as additional security, training, logistics, and higher construction expenses. Per Airports Council International North America, more than 80 percent of U.S. airports employ a “street pricing plus” policy to allow concessionaires to offset those added costs. The current policy caps all concession prices at local, off-airport “street prices” plus a maximum of 10 percent.
To ensure compliance with fair market pricing policy for goods sold at airport concessionaires, the Port Authority conducts routine monitoring to enforce compliance of the agency’s street pricing standards. Additionally, the agency reviews customer complaints from feedback forms and social media. If a concessionaire is found in violation of the pricing policy, the Port Authority, terminal operators, and/or concessions management companies may take corrective action to ensure compliance.
The Port Authority’s redevelopment of its airports prioritizes significant improvements to customer service and experience, underscoring the need for highly skilled workers employed at its airports. So far, the agency’s focus in transforming its airports into best-in-class gateways has yielded internationally recognized accolades. These include the 2024 Skytrax honor naming Newark Liberty’s Terminal A the world’s best new airport terminal, a similar honor in 2023 for LaGuardia Airport’s Terminal B, as well as Skytrax’s highest rating at five stars for facilities, service, and customer experience for both terminals at the two airports based on traveler surveys.
The need for additional skilled airport workers will grow in the coming years as new or expanded terminals open as part of the Port Authority’s multi-billion dollar redevelopment of John F. Kennedy International (JFK) and Newark airports. Within JFK’s $19 billion transformation, terminals 1 and 6 are scheduled to open in 2026, while terminals 4 and 8 are in the process of expansions and renovations that include new retail overhauls and opportunities for more airport businesses. At Newark Liberty, further redevelopment planning is underway with the release of the Newark Vision plan, following the 2023 opening of the new Terminal A.
The Port Authority is committed to soliciting public input as it considers these changes. A 30-day comment period is now open, during which members of the public and all interested parties are invited to submit comments via the Port Authority website. All comments received about the proposed policy will be submitted to the commissioners for consideration of changes, if any, which should be made to the proposal. The Board will then take action on the proposal at its Dec. 12 meeting.
About the Port Authority of New York and New Jersey
The Port Authority of New York and New Jersey is a bi-state agency that builds, operates, and maintains many of the most important transportation and trade infrastructure assets in the country. For over a century, the agency’s network of major airports; critical bridges, tunnels and bus terminals; a commuter rail line; and the busiest seaport on the East Coast has been among the most vital in the country – transporting hundreds of millions of people and moving essential goods into and out of the region. The Port Authority also owns and manages the 16-acre World Trade Center campus, which today welcomes tens of thousands of office workers and millions of annual visitors. The agency’s historic $37 billion 10-year capital plan includes an unprecedented transformation of the region’s three major airports – LaGuardia, Newark Liberty and JFK – as well as an array of other new and upgraded assets, including the $2 billion renovation of the 90-year-old George Washington Bridge. The Port Authority’s annual budget of $9.3 billion includes no tax revenue from either the states of New York or New Jersey or from the City of New York. The agency raises the necessary funds for the improvement, construction or acquisition of its facilities primarily on its own credit. For more information, visit www.panynj.gov or check out the Now Arriving blog.