Minimum wages are increasing in nearly half the states this year

What’s holding Kentucky back? 

The min­i­mum wage will increase in near­ly half the states this year even as the fed­er­al wage floor remains stuck at $7.25 per hour.

In many states, the min­i­mum wage is auto­mat­i­cal­ly adjust­ed upward as infla­tion ris­es. But vot­ers in sev­er­al states, includ­ing deeply red ones such as Alaska and Missouri, chose in November to sig­nif­i­cant­ly increase their min­i­mum wages this year.

Michigan will see its min­i­mum wage jump from $10.33 to $12.48 on Feb. 21 after the state Supreme Court con­clud­ed the leg­is­la­ture sub­vert­ed res­i­dents when it adopt­ed but then sig­nif­i­cant­ly amend­ed vot­er-ini­ti­at­ed bal­lot mea­sures in 2018 to raise the min­i­mum wage and man­date paid sick time.

Michigan’s wage floor is set to rise to $14.97 by 2028 — more than dou­ble the fed­er­al min­i­mum wage, which has not increased since 2009. That’s the longest peri­od with­out a fed­er­al increase since Congress first set a min­i­mum wage in 1938.

A total of 30 states and the District of Columbia have set their own min­i­mum wage high­er than the fed­er­al rate. And 67 local­i­ties — includ­ing Birmingham, Alabama; Denver; Flagstaff, Arizona; and Los Angeles — have raised their min­i­mum wage above the state min­i­mum, accord­ing to the Economic Policy Institute, a left-lean­ing think tank.

Currently, 10 states have a min­i­mum wage of $15 or high­er: California, Connecticut, Delaware, Illinois, Maryland, Massachusetts, New Jersey, New York, Rhode Island and Washington.

Alaska, Florida, Hawaii, Missouri and Nebraska are on track to reach the $15 bench­mark in the com­ing years. Such move­ment in red states should prompt Republicans who con­trol Congress and the White House to move the nation­al wage floor, argued Richard von Glahn, the polit­i­cal direc­tor at the labor advo­ca­cy group Missouri Jobs with Justice.

“We should have Republican leg­is­la­tors look­ing and see­ing what their own vot­ers are telling them and say, ‘You know, maybe they’re on to some­thing here and maybe I should fol­low their lead,” he said.

Von Glahn led a suc­cess­ful cam­paign to raise Missouri’s min­i­mum wage from 2024’s rate of $12.30 to $15 per hour next January through a November bal­lot ini­tia­tive that also guar­an­teed sick leave for many workers.

While a tight labor mar­ket forces many employ­ers to pay above min­i­mum wage to com­pete, von Glahn not­ed many work­ers still earn at or near the low­est legal rate. The Economic Policy Institute esti­mates that more than half a mil­lion Missouri work­ers will see rais­es as the state’s min­i­mum wage increases.

“That sort of proves the point as to why this is so nec­es­sary, why these guardrails are so impor­tant,” he said.

For Kaamilya Hobbs, the Missouri law means she can expect at least an extra 31 cents per hour once she returns to work at Arby’s fol­low­ing mater­ni­ty leave.

This year’s new min­i­mum wage of $13.75 isn’t enough to live com­fort­ably in Kansas City, she said. But every bit helps her afford the basics, such as dia­pers and baby formula.

“It won’t be a huge dif­fer­ence. But it’ll still be a lit­tle bit of some­thing for us,” said Hobbs, 33, who is also an orga­niz­er for a group advo­cat­ing for low-wage workers.

Inflation has sig­nif­i­cant­ly erod­ed the buy­ing pow­er of the stag­nant fed­er­al min­i­mum wage. Advocates say rais­ing the wage floor helps low-wage work­ers cov­er the ris­ing cost of essen­tials and boosts the econ­o­my by putting more mon­ey into the pock­ets of peo­ple who are like­ly to spend it. But many employ­ers, espe­cial­ly retail­ers and restau­rants, counter that rais­ing the min­i­mum wage forces them to cut work­ers or raise prices.

In December, President-elect Donald Trump said he would con­sid­er a nation­al increase in the min­i­mum wage. Trump won 19 of the 20 states — all but New Hampshire — still sub­ject to a $7.25 min­i­mum wage. In an NBC News inter­view, he acknowl­edged the $7.25 rate was “a very low num­ber,” but said rais­ing the min­i­mum wage too much would decrease employment.

“There is a lev­el at which you can do it,” he said, with­out spec­i­fy­ing a number.

Earlier this month, Alaska’s min­i­mum wage went up 18 cents thanks to an auto­mat­ic infla­tion-based bump.

But the state’s cur­rent $11.91 rate will increase to $13 this July, thanks to the pas­sage of a November bal­lot mea­sure. Under the mea­sure, the wage will increase to $14 in July 2026 and $15 in July 2027, fol­lowed by infla­tion-adjust­ed increas­es start­ing in 2028.

The bal­lot mea­sure drew fierce oppo­si­tion from busi­ness groups but won approval by 58%-42%. The new law also man­dates employ­ers pro­vide up to sev­en paid sick days per year — a major con­cern par­tic­u­lar­ly in sea­son­al indus­tries, includ­ing tourism.

Before November’s elec­tion, mem­bers of the Alaska Cabaret, Hotel, Restaurant and Retailers Association said pas­sage of the bal­lot mea­sure would result in high­er prices and lead to lay­offs and reduced hours for work­ers, said Sarah Oates Harlow, pres­i­dent and chief exec­u­tive offi­cer of the organization.Mark Robokoff, own­er of the pet sup­ply store AK Bark in Anchorage, Alaska, sup­ports the effort to raise the state’s min­i­mum wage. (Courtesy of Mark Robokoff)

The min­i­mum wage hike will par­tic­u­lar­ly hurt small­er busi­ness­es, she said, and those with tipped work­ers such as servers and bar­tenders. Alaska is among sev­en states that don’t allow employ­ers to pay tipped employ­ees less than the min­i­mum wage, mean­ing many of those work­ers are already mak­ing well above the state’s wage floor, she said.

“I guar­an­tee you we will be see­ing prices going up across the board,” she said. “Groceries are going to be more expen­sive. Eating out is going to be more expensive.”

But Mark Robokoff, who owns the pet sup­ply store AK Bark in Anchorage, sees a high­er wage floor as good for busi­ness. He said the min­i­mum wage increase will put more mon­ey into the pock­ets of his customers.

“It’s not like there’s no ben­e­fit to this cost,” Robokoff said.

To attract the best staff, he said, employ­ee wages start at $17 per hour. But he expects to ratch­et that fig­ure up as the state’s min­i­mum wage increases.

“That’s why it need­ed to be a law,” he said. “It only works if we all do it. Then we all get more rev­enue and pay our employ­ees a lit­tle bit more.”

This sto­ry is repub­lished from Stateline, a sis­ter pub­li­ca­tion to the Kentucky Lantern and part of the non­prof­it States Newsroom network.