Friday, January 23, 2015

States Take Minimum Wage into Own Hands

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As of January 1, there are now 29 states that have minimum wages higher than the federal government. This is an unprecedented number that have some people wondering, "How did this happen?"

In his January 2014 State of the Union address, President Obama announced that he planned to introduce legislation that would increase the federal minimum wage to $10.10/hour over a three-year period. Now with a Republican-controlled Congress, the legislation supporting this increase may be delayed. Many states have since taken it upon themselves to handle the issue of wages for workers rather than waiting for Congress to take action.

There are currently 12 states that have indexed their minimum wages either for inflation or for changes in the cost of living. The rates in these states are likely to change every year and stay above the federal rate—which is a flat amount not indexed for inflation. At least three more states will forever be above the federal rate because their laws require it.

  • The minimum wage in Massachusetts is the federal rate, plus .10 cents — so $7.35 an hour.
  • Alaska's rate is the federal rate, plus .50 cents — so that's $7.75 an hour.
  • Connecticut's minimum wage is 0.5% higher than the federal rate, rounded to the nearest penny. This year that works out to $9.15 an hour.
In some cases, cities and counties have gone above and beyond what their states require. Seattle hit the headlines when it raised its minimum wage to $15 an hour. Albuquerque, Santa Fe, and Bernadillo County, N.M. have all adjusted their minimum wages for inflation. San Francisco and San Jose, CA, did the same. Prince George's County, MD, raised its rate to $10.50 an hour, $2.25 above the state rate of $8.25 an hour. These are just a few examples of states and localities attempting to ensure a livable wage for workers.

Check back with Pay News Now often for more minimum wage news and rate changes across the country.