Here’s a little bit of good news for the new year: more than one million low-wage workers got a raise on January 1, when the minimum wage increased in the eight states that index their minimum wage for inflation. In each of these states (Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont, and Washington), women make up a majority of the workers who will see their paychecks increase this month. An adjustment for inflation also increased the minimum wage in San Francisco to $10.24 per hour, making it the first large city in the country to require hourly pay above $10.
However, these jurisdictions represent the exception rather than the rule. While another 10 states, the District of Columbia, and some other localities have minimum wages that are set higher than the federal minimum wage, most of their minimum wage rates are fixed and don’t keep pace with inflation. The minimum wage is still below $9.00 an hour in every state but Washington (where it just rose to $9.04/hour). Worst of all, in more than half the states, the minimum wage remains at the federal level, which is just $7.25 an hour.
As the New York Times editorial page highlighted, it’s past time for the federal government to set a higher standard for the states. A woman working full time, year round at the current federal minimum wage will earn just $14,500 annually – that’s more than $3,000 below the federal poverty line for a mother with two children. The value of the federal minimum wage has declined over time; if it had kept pace with inflation since 1968 (when the wage was at its highest mark), it would now be $10.39 per hour. The federal minimum wage for tipped workers is lower still; since 1991, it has been set at just $2.13 an hour, providing an annual base wage of only $4,260 for tipped employees working full time, year round. Read more »