On July 1, workers in more than 20 US states, cities, and counties will receive a wage increase as higher minimum wages kick into effect. This is part of a national push to ensure that the nation’s lowest-paid workers can keep up with rising living costs.
The states include Oregon, Nevada, Connecticut and Oregon. A dozen California cities including Los Angeles, San Francisco and San Francisco will see their minimum wages increase starting July 1. Chicago, St. Paul and St. Paul in Minnesota also have higher minimum wages. A few counties, such as Cook County in Illinois or Montgomery County in Maryland, are increasing their minimum wages.
Experts note that while the most vulnerable workers in these states, cities, and counties will be affected, the baseline wage is a way to set an earnings ceiling for the majority of employees.
These increases come as the federal minimum wages nears 13 years since its last increase. This marks the longest time without an increase in the federal minimum wage since 1938, when it was established. The federal minimum wage of $7.25 per hour is the wage floor in 20 states, mainly in the South and Midwest. This rate is lower than the $8.38 poverty line for families with two or more people, if one person is employed.
Thirty-seven states and the District of Columbia have increased their wages beyond the federal baseline wage. Some states tie increases to the cost of living. Holly Sklar CEO of Business for a Fair Minimum Wage (which advocates for a higher minimum wages) said that this should be a fair way to ensure workers keep up with inflation.
You are in the right place when you index to the cost-of-living. Sklar explained to CBS MoneyWatch that it is not like a big pay increase, but it allows you not to fall behind. It’s vital.”
She said that the federal minimum wage was “designed to keep people from poverty” and is now keeping them in poverty in states where it remains law.
On July 24, 2009, the federal minimum wage reached $7.25 an hr. According to an analysis by the Center for Economic and Policy Research, if the baseline wage had increased with the nation’s productivity gains since 1968, it would have reached nearly $21.50 per hour in 2020.
While a higher wage may impact a company’s profitability, it can also help to retain employees and improve morale. Gina Schaefer is the owner of A Few Cool Hardware Stores which has 13 Ace Hardware locations. Schaefer will begin paying $16.10 an hr at the minimum wage in seven of these locations, which are located in D.C.
Schaefer, a member of Business for a Fair Minimum Wage, stated that “the more money my teammates earn, the more they take into their community.” “They are less likely to use social services and have more money for the local community.”
Schaefer stated that most of her employees earn more than the minimum wage. However, she does hire some new workers — such as teenagers in their first jobs — at the baseline wages. She said that an increase in the minimum wage “has a significant impact on the company’s profitability.” She added that she was in favor of the increase.
On Friday, Connecticut’s baseline wage will rise from $13 to $14. Workers will also see an additional boost of $15 per hour on June 1, 2023. According to data from the government, Connecticut has 1.9 million civil workers.
This boost is due to a law that was in effect three years earlier. Annual adjustments will be made to the Employment Cost Index beginning January 1, 2024, following the June 2023 rise.
Nevada’s minimum wages will rise from $9.75 per hour to $10.50 for workers who don’t have health coverage to employees with insurance. However, baseline pay for those who do have health insurance will go up from $8.75 to $9.50 an hr.
In 2024, the base wage will reach $12 an hour. ($11 for those with health insurance coverage), this is the extent of increases.
Nevada is home to approximately 1.5 million people.
Oregon’s minimum wages will rise from $12.75 per hour to $13.50 Friday. There are 2.2 million state workers.
However, the state law provides that there are different baseline rates for Portland and nonurban counties. Portland workers will see an increase of $14.75 to $14.75 per hour. Non-urban counties will see a rise in the hourly wage from $12.50 to $12.50.
The Consumer Price Index measures price increases across a range of goods and services. It will adjust the state’s baseline wages annually starting in 2023.
Washington, D.C. will increase its minimum wage from $15.20 per hour to $16.10 per hour Friday.
Its minimum wage index is adjusted to the 12-month percentage increase in the Consumer Price Index for All Urban Consumers for the D.C. Region (CPI-U), with the changes being implemented on July 1, each year.
Nearly 400,000 people work in D.C.
According to Fisher Phillips, these California cities and counties will increase their baseline wages Friday.
These cities and counties will also increase their minimum wage Friday.
