Minimum Wages Increase in 22 States After the New Year

As the calendar turns to a fresh new year, there’s a financial silver lining for minimum-wage earners across 22 states. Approximately 9.9 million workers will see a significant surge in their paychecks, a move that is anticipated to inject an additional $6.95 billion into the economy, according to the Economic Policy Institute (EPI).

Breaking the confines of states, 38 municipalities — which include cities and counties — are also joining in. From Jan. 1, they will hike their minimum wages beyond the state-mandated minimums. But amidst these bright spots, 20 states have chosen to cling to the federal minimum wage of $7.25 per hour, as per the Department of Labor’s data.

There’s a wave of millionaires who are pushing to tax the rich more aggressively, and they are voicing their plea to the working-class voters. Roughly 17.6 million workers still earn less than $15 per hour, with nearly half of them residing in the aforementioned 20 states that continue to adhere to the federal minimum wage. It is worth noting that this rate hasn’t seen an increment since 2009, despite the soaring cost of living.

The Bureau of Labor Statistics (BLS) indicates a worrying trend in the value of the dollar. One dollar in 2023 carries only 70% of the purchasing power it held in 2009, making essential goods and services more inaccessible to low-wage earners.

The rise in inflation and the escalating cost of virtually everything — from housing to groceries — has compelled many Americans to dig deep into their savings and accrue more debt. Despite an ostensibly robust economy, characterized by thriving retail sales, hearty job numbers, and a decelerating rate of inflation, minimum wage earners find themselves struggling to cover rent and afford basic household necessities.

Attributes such as gender, race, and ethnicity also come into play in this scenario. EPI’s data reveals that nearly 58% of workers who will benefit from the wage increase are women, while 9% are Black and close to 38% are Hispanic. Parents, who make up over a quarter of those benefiting from the wage hike, stand to see substantial improvements in their living standards, given that nearly 20% of these minimum-wage workers are currently living below the poverty line.

Target, the popular retail corporation, has taken a proactive step by increasing its minimum wage to as much as $24 per hour.

In a related development, the Raise the Wage Act of 2023 was introduced by Senate Democrats last July. If enacted, this would see a phased increase of the federal minimum wage, hitting $17 per hour by 2028.