Minimum Wage Increases: 23 States See Adjustments in January

As of January 1st, 2023, the minimum wage has increased in 23 states across the United States. The increase ranged from a 23-cent raise in Michigan to an increase of $1.50 in Nebraska, giving many minimum wage earners reasons to celebrate.

The adjustments were mainly due to the increased rate of inflation that swept the nation within the past year. This situation was documented by Deirdre Kennedy, senior payroll analyst of data research firm Wolters Kluwer.

Several states have raised their minimum wage to $15/hour or higher in the coming years. For example, Washington state has one of the nation’s highest base hourly rates, going from $14.49 in 2022 to $15.74 at the start of 2023. Connecticut, Florida, Nevada, and Oregon anticipate a bump in their employees’ minimum base pay by September, with Florida reaching $15 an hour by 2026. New Jersey is set to raise its minimum wage to $15 an hour by 2024, while Delaware, Illinois, Maryland, Rhode Island, and Virginia will have higher minimum wages for their employees by 2025. Meanwhile, the District of Columbia currently has a minimum wage of $16.10 an hour, making it the highest dollar value for all minimum wages in the U.S.

It’s worth noting that in most cases, individual cities and municipalities have higher minimum wage base pay than the minimum wage set at the state level. However, 20 states have a minimum wage equal to or below the federal minimum. Alternatively, other states have no minimum wage, so the federal minimum wage is the default pay rate.

The minimum wage law applies to the employees of enterprises with a total annual gross volume of sales or business of no less than $500,000. This law also applies to the employees of smaller firms as long as the employees are engaged in interstate commerce or the production of goods for commerce. It applies to employees who work for federal, state or local government agencies, as well as hospitals or schools. Employers that employ full-time students who work in retail or for service-related stores are also subject, as are those in the agriculture industry. Waitstaff often experience significant exemptions because they receive tips as part of their job. However, the employer must reconcile the difference if the employee’s pay is not equal to the minimum wage.