Labor activists hold a rally in support of the $15 national minimum wage on May 19, 2021 in Washington, D.C.
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Because the calendar approaches 2023, staff in greater than half of all states have something to stay up for this 12 months: the next minimum wage.
That is since the federal minimum wage is $7.25 an hour – the identical rate since 2009.
But many states and cities have introduced their very own rates, and most are expected to extend in the brand new 12 months.
A complete of 26 states have announced higher minimum wages will be enacted in 2023, and yet one more state is prone to see a revision in July, based on tests from the payroll experts at Wolters Kluwer Legal & Regulatory US
Meanwhile, 23 states and Washington, based on Institute of Economic Policywill introduce higher minimum wages on January 1. The increases, which will range from 23 cents to $1.50 an hour, will affect 8 million staff.
In keeping with Wolters Kluwer, the state that may provide the best minimum wage is Washington, which is $15.74 per hour.
Employees under the age of 16 in the state will be paid $13.38 an hour starting in 2023, or 85% of the minimum adult wage.
The minimum wage in Washington will be $16.10 an hour.
Washington and 13 states tie their minimum wages to the Consumer Price Index, a government measure of the common change consumers pay for specific goods and services.
“There are quite a number of states across the country that will see quite large jumps in the minimum wage because of higher inflation rates last 12 months,” said Deirdre Kennedy, senior wage analyst at Wolters Kluwer.
Other states will proceed to implement increases enacted by laws. States with no minimum wage hike in 2023 still tie their base pay to the federal rate of $7.25 an hour.
How the federal minimum wage affects staff
President Joe Biden campaigned to raise the federal minimum wage to $15 an hour. He signed an executive order in 2022, bringing it as much as this level for federal employees and contractors.
But a broader change to $15 an hour nationwide would must be passed by Congress. Efforts to raise the speed nationally haven’t been included in the 2021 Covid-19 relief regulations.
“Because the gap between this and the federal minimum wage widens, it will be interesting to see if that might spur more states to extend their wages or attempt to get more momentum on the federal level,” said Kevin Werner, a research associate at Urban’s Income and Advantages Policy Center. institute.
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Raising the national minimum wage to $15 an hour would affect 56 million staff, based on the Urban Institute report published in September.
The study modeled possible outcomes where the brand new $15 minimum wage led to either no job loss or two different scenarios where long-term job loss occurred.
“Even in our worst job loss scenario, we found that the common employee was higher off and poverty overall fell,” Werner said.
“Despite the fact that some individuals who lost their jobs could have been worse off, the web effect was still positive,” he said.
There are quite a number of states across the country where there will be quite large jumps in the minimum wage because of the upper rate of inflation last 12 months.
Deirdre Kennedy
senior payroll analyst at Wolters Kluwer Legal & Regulatory US
In keeping with Werner, most staff who can be affected by the $15 minimum wage are over the age of 25. A few third are the one people supporting their families.
Employees who’re depending on the minimum wage are also rather more prone to be people of color and living in poverty. As such, raising the minimum wage nationwide would help disadvantaged people, Werner said.
Raising the minimum wage may also help boost consumer demand and put a refund into local economies, said Holly Sklar, chief executive of Business for a Fair Minimum Wage, a national network of business organizations, owners and executives that support higher minimum wages.
“Putting needed raises into the pockets of minimum wage staff [is] really probably the most effective way you’ll be able to boost the economy,” said Sklar. “These are the individuals who need to return and spend immediately.”
With federal motion to raise the minimum wage uncertain, some large corporations have already stepped up their efforts to raise wage rates.
Costco raised the minimum wage for US store staff to $16 an hour Objective, Amazon and Walmart all moved to paying hourly staff $15 an hour.
Werner noted that because the economy continued to reopen after the Covid lockdown, competition for staff has prompted employers to supply higher wages and starting bonuses to staff in the lower income bracket.
“It gives low-income staff more leverage than before,” he said.