In cases like these, the law favors the rate most beneficial to the employee — in other words, the highest minimum wage. As 2024 unfolds, changes to the business climate are already underway as nearly half of the US adjusts to minimum wage increases. Twenty-two states have already implemented new minimum wage standards, while three other states are set to follow suit later this year. Workers minimum wages whose wages would be between the previously applicable minimum (state or federal) and the proposed minimum if the federal minimum wage remained unchanged. Under any of the policy options, such workers would either become jobless or see increases in their earnings in an average week. The table below lists the current prevailing 2024 minimum wage rates for every state in the United States.
On top of the state pay hikes, an additional 38 cities and counties will also increase their minimum wages, the group said. Higher minimum wages will go into effect on January 1 across 22 states, giving an economic boost to almost 10 million workers, according to a recent estimate. “We’ve got real wages growing, inflation has been moderating and we’ve got the unemployment rate falling in that data last week as well.” When the federal government declared last week that it did not want minimum wage earners to “go backwards”, it was not a surprise.
Government activity
Click any state for details about the minimum wage, exemptions, and other state labor laws. You can find a list of highest and lowest minimum wage rates here. This report sets out some of the immediate impacts of the minimum wage upratings on 1 April 2024. This includes the likely number of jobs affected and the increase relative to inflation.
Using the right time tracking and payroll software ensures that you remain compliant with little effort. Inflation, defined as the sustained increase in the general price level of goods and services, can lead to a decrease in the purchasing power of consumers. As businesses adjust prices to compensate for rising wages, individuals’ living costs also rise. This interconnected relationship between rising minimum wages and inflation underscores the complexities businesses face in maintaining financial equilibrium. How would increasing the minimum wage affect the number of people in poverty?
State Minimum Wage Laws
Under a voluntary flexible work hour plan approved by the Alaska Department of Labor, a 10 hour day, 40 hour workweek may be instituted with premium pay after 10 hours a day. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour. Denver, for instance, will increase the city’s minimum wage to $18.29 an hour on January 1, topping Colorado’s rate of $14.42 an hour. “Minimum wage increases are also vital to many workers who are more vulnerable to exploitation, whether it’s because of immigration status, disability, or place of work,” Martinez Hickey wrote. Increasing the minimum wage is both good for workers and the overall economy, said Holly Sklar, CEO of Business for a Fair Minimum Wage, a group that advocates for higher baseline wages. Raising the minimum wage could benefit low-wage workers at a time when many continue to struggle with higher costs due to inflation, even as it cools rapidly after hitting a 40-year high in 2022.
- We project growth in line with Average Weekly Earnings data (12-month-on-12-month growth), where this is available (currently up to January 2024.) This is the light blue line on the chart opposite.
- We take the most recent estimate of median hourly earnings from the Annual Survey of Hours and Earnings (ASHE), an employer survey of 1 per cent of employees in PAYE as our baseline.
- The department is Ohio’s chief regulatory agency, focused on promoting prosperity and protecting what matters most to Ohioans.
- Alex Johnson owns 10 Auntie Anne’s Pretzels and Cinnabon restaurants in the San Francisco Bay Area.
- We do this by taking two-thirds of our estimate of median hourly pay.
Five years later, in July 2029, the minimum wage reaches its target of $17 per hour. The subminimum wage for tipped workers reaches $17 per hour in July 2030 and equals the regular minimum wage beginning the following year. Our estimate is based on the historic relationship between growth in the bite (the minimum wage relative to median hourly pay) and coverage (the number of people paid the minimum wage). In years when the bite has grown quickly, we have tended to see big increases in the number of people paid the minimum wage.
When do minimum wage changes apply?
The minimum wage for the state of Illinois increased by $1 from $13 to $14 on January 1, 2024. This was the sixth increase since 2019, putting Illinois on track to hitting a $15 minimum wage by 2025. In some cases, meals or lodging can be used to meet part of the minimum wage obligation.