Even though the federal wage floor is still set at $7.25 per hour, the minimum wage will rise in almost half of the states this year.
As inflation increases, the minimum wage is automatically raised in many states. However, voters in November decided to raise minimum wages this year in a number of states, including heavily red ones like Missouri and Alaska.
After the state Supreme Court ruled that the legislature had subverted citizens by adopting and then drastically changing voter-initiated ballot proposals in 2018 to raise the minimum wage and require paid sick leave, Michigan’s minimum wage will increase from $10.33 to $12.48 on February 21.
The federal minimum wage has not raised since 2009, and by 2028, Michigan’s wage floor is expected to more than quadruple to $14.97. Since Congress originally established a minimum wage in 1938, that is the longest time without a federal increase.
The minimum wage in 30 states and the District of Columbia is greater than the federal minimum wage. Additionally, the left-leaning think tank Economic Policy Institute reports that 67 cities have increased their minimum wages above the state level, including Denver, Flagstaff, Arizona, and Los Angeles.
At the moment, ten states—California, Connecticut, Delaware, Illinois, Maryland, Massachusetts, New Jersey, New York, Rhode Island, and Washington—have minimum wages of $15 or more.
In the upcoming years, Alaska, Florida, Hawaii, Missouri, and Nebraska are expected to achieve the $15 benchmark. Richard von Glahn, the political director of the labor advocacy group Missouri Jobs with Justice, contended that such action in red states should force Republicans, who control Congress and the White House, to change the national wage floor.
“You know, maybe they’re on to something here and maybe I should follow their lead,” he added, referring to the idea of Republican lawmakers observing what their own constituents are saying.
The minimum wage in Idaho is at $7.25 per hour.
Von Glahn spearheaded a successful effort to increase Missouri’s minimum wage from $12.30 per hour in 2024 to $15 per hour in January of next year through a ballot proposal in November that also provided many workers with sick leave.
Von Glahn pointed out that many workers continue to make at or close to the lowest legal rate, even if a competitive labor market pushes many firms to pay more than the minimum wage in order to compete. As the state’s minimum wage rises, the Economic Policy Institute predicts that over half a million Missouri workers will receive raises.
He said that kind of demonstrates why this is so crucial and why these guardrails are so necessary.
When Kaamilya Hobbs returns to work at Arby’s after maternity leave, she can anticipate earning at least an additional 31 cents per hour due to Missouri legislation.
According to her, the new minimum wage of $13.75 for this year is insufficient to live comfortably in Kansas City. However, every penny helps her pay for necessities like infant formula and diapers.
The difference won’t be significant. However, Hobbs, 33, who also organizes for a group that supports low-wage workers, stated that it will still be something for us.
The purchasing power of the stagnant federal minimum wage has been severely reduced by inflation. Raising the wage floor, according to supporters, helps low-income workers pay for the growing cost of necessities and stimulates the economy by putting more money in the hands of those who are most likely to spend it. However, many firms argue that raising the minimum wage causes them to hike prices or lay off employees, particularly in the retail and food industries.
President-elect Donald Trump stated in December that he would think about raising the minimum wage nationwide. Trump won 19 of the 20 states, with the exception of New Hampshire, where the minimum wage remains at $7.25.In an interview with NBC News, he admitted that the $7.25 rate was extremely low but claimed that a significant increase in the minimum wage would result in fewer jobs.
Without giving a specific number, he stated that there is a level at which you can accomplish it.
Alaska’s minimum wage automatically increased by 18 cents based on inflation earlier this month.
However, a referendum proposal passed in November will raise the state’s current rate of $11.91 to $13 come July. The measure calls for raising the salary to $14 in July 2026 and $15 in July 2027, with inflation-adjusted hikes beginning in 2028.
Despite strong opposition from business associations, the ballot question was approved by 58% of voters. Additionally, the new rule requires companies to offer up to seven paid sick days annually, which is a big deal, especially for seasonal industries like tourism.
Prior to the November election, Sarah Oates Harlow, president and CEO of the Alaska Cabaret, Hotel, Restaurant and Retailers Association, stated that if the ballot measure were approved, it would raise prices and cause employees to lose their jobs and work fewer hours.
According to her, smaller companies and those who employ tipped employees like servers and bartenders will be especially negatively impacted by the minimum wage increase. Many of those workers are already earning far more than the state’s wage limit, she added, because Alaska is one of seven states that forbid companies from paying tipped employees less than the minimum wage.
We’re going to see price increases everywhere, I promise,” she remarked. The cost of groceries will increase. The cost of eating out will increase.
However, Mark Robokoff, the owner of Anchorage’s AK Bark pet supply store, believes that a higher wage floor will benefit his company. He said that his consumers will benefit financially from the increase in the minimum wage.
Robokoff stated, “It’s not like there is no benefit to this cost.”
According to him, employee wages start at $17 per hour in order to draw in the best employees. However, he anticipates raising that amount when the state’s minimum wage rises.
He stated that’s why it had to be a law. Only if we all do it will it work. After that, we all make more money and give our workers a tiny raise.
Like the Idaho Capital Sun, Stateline is a member of States Newsroom, a 501c(3) public charity news network backed by grants and a coalition of donors. Editorial independence is upheld by Stateline. For inquiries, send an email to [email protected] to reach Editor Scott S. Greenberger.
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