23 US states and Washington, D.C. rang in 2023 with good news for workers – higher minimum wage rates. Three more states will follow suit later in the year, making a total of 27 states with new minimum wages this year.
Minimum wage is the lowest amount a person can expect to earn or a company must pay for hourly jobs. While the minimum wage is set by the federal government, state and local laws can determine the actual number for each state depending on factors like inflation and cost of living. The federal minimum wage for tipped workers is far below the regular hourly rate; this piece focuses on rates for workers who are not tipped.
The federal minimum wage rate has remained stagnant at $7.25 per hour since 2009, making state-wise increases more significant in the day-to-day operations of companies – and the lives of workers.
The impact of minimum wage rates on businesses and workers
Minimum wage rates affect all parties involved – workers, businesses, and the economy. Governments use minimum wage to gauge the financial and overall well-being of citizens, within the country and when compared to other nations. High or low minimum wages can lead to issues with unemployment levels; either people are not inclined to sell themselves short, or companies are not willing to increase wages. For workers, a periodic increase in minimum wage rates has allowed them to maintain or improve their standard of living while coping with the effects of inflation, besides being an incentive to increase their productivity.
The Economic Policy Institute anticipates that this next round of minimum wage increase in 2023 will bump up pay for approximately 8.4 million American workers by more than $5 billion. The majority of workers who will be affected by the change are:
Women – 58.7%
More than 25 years old – 54.9%
Full-time workers – 44.8%
Have college exposure – 40.9%
Any future developments in minimum wage rates will likely continue to affect minorities and those with families the most. A report from the Urban Institute found that if minimum wage rates are raised to $15 per hour at the federal level, it would make a difference to a third of the American working population, i.e., 56 million people. It could also lift 6.9 million people out of poverty.
New minimum wage rates by state
Washington, California, New Jersey, and New York continue to be the frontrunners for the state with highest minimum wages. Nebraska, Colorado, and Maine have the biggest jump in numbers with over $1 difference between past and present rates.
Workers in Connecticut, District of Columbia, Florida, and Nevada have a few more weeks of waiting before they can enjoy a hike. Oregon’s minimum wage rates will be evaluated on April 30 and revised on July 1 based on the Consumer Price Index (CPI), a measure of the purchasing power and spending capabilities in the US. Some other states also rely on the CPI to adjust minimum wages according to inflation or deflation patterns.
States that increased minimum wage rates in 2023
|
State |
Minimum Wage in 2022 |
Minimum Wage in 2023 |
|
Alaska |
$10.34 |
$10.85 |
|
Arizona |
$12.85 |
$13.85 |
|
California |
$15 |
$15.50 |
|
Colorado |
$12.56 |
$13.65 |
|
Connecticut |
$14 |
$15 (from 6-1-2023) |
|
Delaware |
$10.50 |
$11.75 |
|
District of Columbia |
$16.10 |
$17 (from 7-1-2023) |
|
Florida |
$11 |
$12 (from 9-30-2023) |
|
Illinois |
$12 |
$13 |
|
Maine |
$12.75 |
$13.80 |
|
Maryland |
$12.50 |
$13.25 |
|
Massachusetts |
$14.25 |
$15 |
|
Michigan |
$9.87 |
$10.10 |
|
Minnesota |
$10.33 |
$10.59 |
|
Missouri |
$11.15 |
$12 |
|
Montana |
$9.20 |
$9.95 |
|
Nebraska |
$9 |
$10.50 |
|
Nevada |
$10.50 |
$11.25 (from 7-1-2023) |
|
New Jersey |
$13 |
$14.13 |
|
New Mexico |
$11.50 |
$12 |
|
New York |
$13.20 |
$14.20 |
|
Ohio |
$9.30 |
$10.10 |
|
Rhode Island |
$12.15 |
$13 |
|
South Dakota |
$9.95 |
$10.80 |
|
Vermont |
$12.55 |
$13.18 |
|
Virginia |
$11 |
$12 |
|
Washington |
$14.49 |
$15.74 |
Minimum wage rates in other states in 2023
State | Minimum Wage in 2023 |
Alabama | $7.25 |
Arkansas | $11 |
Georgia | $7.25 |
Hawaii | $12 |
Idaho | $7.25 |
Indiana | $7.25 |
Iowa | $7.25 |
Kansas | $7.25 |
Kentucky | $7.25 |
Louisiana | $7.25 |
Mississippi | $7.25 |
New Hampshire | $7.25 |
North Carolina | $7.25 |
North Dakota | $7.25 |
Oklahoma | $7.25 |
Oregon | $13.50 |
Pennsylvania | $7.25 |
South Carolina | $7.25 |
Tennessee | $7.25 |
Texas | $7.25 |
Utah | $7.25 |
West Virginia | $8.75 |
Wisconsin | $7.25 |
Wyoming | $7.25 |
Are you a worker looking for the right opportunities with competitive pay? Crowdstaffing Hiring Marketplace can help you: https://jobs.crowdstaffing.com/.
