20 States to Increase Minimum Wage on New Year’s Day
by Yannet Lathrop and Mitchell Hirsch
3.1 million low-paid workers will receive a pay raise when 20 states ring in the New Year with increases in their minimum wage rates. A majority of states will now have minimum wages that are higher than the federal minimum wage of $7.25.
Of the 20 states increasing minimum wages on New Year’s Day, three (Arkansas, Nebraska and South Dakota) passed increases through 2014 ballot measures; seven states (Connecticut, Hawaii, Maryland, Massachusetts, Rhode Island, Vermont and West Virginia) passed legislation in 2014 to raise the minimum wage; nine states (Arizona, Colorado, Florida, Missouri, Montana, New Jersey, Ohio, Oregon and Washington) are adjusting their minimum wages according to cost of living indexing provisions in their minimum wage laws; and one state, New York, will increase its minimum wage on December 31, 2014, in accordance with legislation passed in 2013.
The New Year’s minimum wage increases will generate $826.8 million in new economic growth as low-paid workers spend the increased earnings on basic necessities for themselves and their families.
As the movement to raise minimum wages continues to gain momentum in states and cities across the country, more states are expected to approve minimum wage increases during the next two years. Ballot initiatives or legislative campaigns have either launched or are being explored in Arizona, California, Colorado, Delaware, Illinois, Maine, Missouri, Oregon, Pennshylvania and New York. And a host of cities are looking to boost their local minimum wage rates over the next year or two as well.
Table A (below) lists states with increases on or about Jan. 1, 2015, the amount of the increase, the new wage, the number of workers directly and indirectly affected, and the GDP impact of each minimum wage increase:
|
States with Minimum Wage Increase |
Amount of Wage Increase |
New Wage on Jan. 1, 2015 |
Total Affected Workers by Jan. 1 Increase |
GDP Impact of Jan. 1 Increase |
Future Increases Approved Through Ballot Initiative, Legislation or Indexing |
| Arizona |
$0.15 |
$8.05 |
146,000 |
$17,543,000 |
Index |
| Arkansas |
$1.25 |
$7.50 |
56,000 |
$11,107,000 |
$8.00 (2016); $8.50 (2017) |
| Colorado |
$0.23 |
$8.23 |
94,000 |
$18,697,000 |
Index |
| Connecticut |
$0.45 |
$9.15 |
112,000 |
$27,101,000 |
$9.60 (2016); $10.10 (2017) |
| Florida |
$0.12 |
$8.05 |
364,000 |
$38,664,000 |
Index |
| Hawaii |
$0.50 |
$7.75 |
37,000 |
$8,773,000 |
$8.50 (2016); $9.25 (2017); $10.10 (2018) |
| Maryland |
$0.75 |
$8.00 |
171,000 |
$55,020,000 |
$8.75 (2016); $9.25 (2017); $10.10 (2018) |
| Massachusetts |
$1.00 |
$9.00 |
280,000 |
$109,294,000 |
$10.00 (2016); $11.00 (2017) |
| Missouri |
$0.15 |
$7.65 |
131,000 |
$31,328,000 |
Index |
| Montana |
$0.15 |
$8.05 |
16,000 |
$1,512,000 |
Index |
| Nebraska |
$0.75 |
$8.00 |
78,000 |
$22,144,000 |
None |
| New Jersey |
$0.13 |
$8.38 |
176,000 |
$34,850,000 |
Index |
| New York |
$0.75 |
$8.75 |
711,000 |
$276,706,000 |
$9.00 (12/31/2015) |
| Ohio |
$0.15 |
$8.10 |
277,000 |
$36,315,000 |
Index |
| Oregon |
$0.15 |
$9.25 |
106,000 |
$18,211,000 |
Index |
| Rhode Island |
$1.00 |
$9.00 |
53,000 |
$26,261,000 |
None |
| South Dakota |
$1.25 |
$8.50 |
52,000 |
$22,466,000 |
Index |
| Vermont |
$0.42 |
$9.15 |
18,000 |
$4,294,000 |
$9.60 (2016); $10.00 (2017); $10.50 (2018); index |
| Washington |
$0.15 |
$9.47 |
176,000 |
$34,938,000 |
Index |
| West Virginia |
$0.75 |
$8.00 |
88,000 |
$31,535,000 |
$8.75 (2016) |
|
Totals |
3,142,000 |
$826,759,000 |
|
||
Sources: Economic Policy Institute analysis of Current Population Survey microdata and National Conference of State Legislatures