January 04, 2021
Minimum Wage Rises Take Effect
Mandated minimum wages are rising in 24 states in 2021.
Workers that labor for large employers in California will be paid at least the highest state-mandated minimum wage in the U.S. – $14 – following a required minimum pay rise that took effect on Jan. 1.
The increase in the Golden State is just one of the state-mandated minimum wage hikes occurring this year. In all, employers in 24 states will be obligated by law to pay higher lowest-level wages based on new compensation requirements.
Workers in Florida, the nation’s third-most populous state after California and Texas, will see two hikes: one to $8.65 to start the year, and another to $10 on Sept. 30. Meanwhile, workers in New Mexico will get the single biggest year-over-year increase – up $1.50 from $9 to $10.50.
The federally mandated minimum wage is $7.25. Minimum wage has been a source of debate. Some, including small-business owners, have argued that higher minimum wages will “reduce or limit the growth of minimum wage jobs across the country, because employers wouldn’t be able to afford to bring on extra workers,” according to U.S. News & World Report. “Research supporting this premise has been inconclusive.”
Meanwhile, many economists have contended that consumers and the U.S. economy in general would be helped by a slightly higher minimum wage. “The theory is that consumers would have more spending power and would more actively contribute to the economy with a higher minimum,” U.S. News explained in its analysis. “There have also been some arguments that higher wage floors could help alleviate pressure on social assistance programs for the impoverished.”
Some economists think minimum wage should be indexed to inflation to help account for cost-of-living increases.
The states with heightened minimum wages that have taken effect or will take effect in 2021 are:
• Alaska: $10.34, up from $10.19
• Arizona: $12.15, up from $12
• Arkansas: $11, up from $10
• California (large employers): $14, up from $13
• California (small employers): $13, up from $12
• Colorado: $12.32, up from $12
• Connecticut: $13, up from $12
• Florida: $8.65, up from $8.56; this will rise a second time to $10 on Sept. 30, 2021.
• Illinois: $11, up from $10
• Maine: $12.15, up from $12
• Maryland: $11.75, up from $11
• Massachusetts: $13.50, up from $12.75
• Minnesota (large employers): $10.08, up from $10
• Minnesota (small employers): $8.21, up from $8.15
• Missouri: $10.30, up from $9.45
• Montana (large businesses): $8.75, up from $8.65
• Nevada (if employer provides health benefits): $8.75, up from $8
• Nevada (no health benefits provided: $9.75, up from $9
• New Jersey: $12, up from $11
• New Mexico: $10.50, up from $9
• New York: $12.50, up from $11.80
• Ohio (large employers): $8.80, up from $8.70
• Oregon: $12.75, up from $12
• Rhode Island: $12, up from $11.50
• South Dakota: $9.45, up from $9.30
• Vermont: $11.75, up from $10.96
• Washington: $13.69, up from $13.50