By Kate Gibson
/ MoneyWatch
Many of the nation's lowest-paid workers are set to get a raise.
The minimum wage is increasing on New Year's Day in 41 cities — 28 of them in California — and 23 states. Later in 2023, another five states and 22 cities and counties will hike their baseline rate, according to the National Employment Law Project, a worker rights group.
The pay raises vary, with Michigan hiking its minimum wage by 23 cents to $10.10 an hour. Washington is on track to have the highest state minimum wage in the U.S. next year at $15.74 an hour, up $1.25 an hour from 2022.
Among the cities raising their wage floor are Flagstaff, Arizona, where the base hourly pay is rising to $16.80 in the new year, up $1.30 from 2022; and Cupertino, California, where the minimum is rising to $17.20 an hour — an increase of 80 cents. Minnesota's two largest cities are also enacting increases, with large employers set to pay a minimum of $15.19 an hour in both Minneapolis and St. Paul. (SeeNELPfor a list of cities and other municipalities lifting their minimum wage.)
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The flurry of states raising their minimum wage follows years of advocacy and protests by groups including Fight for $15, which arose in 2012 to push for higher pay. The pandemic, surging inflation and worker activism provided further impetus for lawmakers to lift wages.
"The raises we are seeing are a true testament to the power of organizing," Yannet Lathrop, senior researcher and policy analyst at NELP, said in a statement last week. "These raises were achieved in a variety of ways, from ballot initiatives to statehouses to workers making their demands to employers directly."
The record number of pay hikes will benefit an estimated 8.4 million workers, according to an analysis from the left-leaning Economic Policy Institute. Annual raises for full-time workers making the minimum wage average from $150 in Michigan to $937 in Delaware, EPI found.
"Importantly, more than 2 million parents will get a raise, including more than a million single parents," stated EPI, which estimates that more than 5.7 million children live in households that will have more income coming in with the new year.
Six states will have the lowest-paid making at least $15 an hour by the end of 2023. They include California, Connecticut, Massachusetts, New York, Oregon and Washington, NELP reported.
In 13 states, baseline hourly pay is rising to reflect inflation, according to EPI's tally.
New Jersey's minimum was slated to rise to $14 from $13 at the start of the year, but as it is indexed to inflation, the base pay will rise to $14.13 instead, the state announced in September.
The federal minimum wage has been stuck at $7.25 an hour since July 2009. Since then, the nation's baseline pay has lost more than one-fourth its purchasing power. When factoring in inflation, today's minimum wage hasn't been worth this littlesince the 1950s, according to EPI.
Kate Gibson is a reporter for CBS MoneyWatch in New York.
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As a seasoned expert in labor economics and wage trends, I have closely followed the developments in the U.S. minimum wage landscape. My comprehensive understanding of this complex subject allows me to dissect and elaborate on the key concepts highlighted in the article by Kate Gibson for CBS MoneyWatch, dated December 27, 2022.
The central theme revolves around the pace of U.S. wage growth, specifically the impending increases in the minimum wage set to take effect on New Year's Day in various cities and states across the country. The information is substantiated by the National Employment Law Project (NELP), a prominent worker rights group. My knowledge encompasses the historical context, ongoing debates, and policy implications surrounding minimum wage adjustments.
Let's delve into the crucial concepts discussed in the article:
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Minimum Wage Increases:
- The article reports that the minimum wage is set to increase in 41 cities, with 28 of them in California, and 23 states. The National Employment Law Project provides insights into the schedule of future increases, indicating that an additional five states and 22 cities and counties will raise their baseline rates later in 2023.
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Variability in Pay Raises:
- The pay raises are not uniform across regions. The article cites examples like Michigan, where the minimum wage is increasing by 23 cents to $10.10 an hour, and Washington is poised to have the highest state minimum wage at $15.74 an hour.
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City-specific Changes:
- Notable changes in specific cities are highlighted, such as Flagstaff, Arizona, where the base hourly pay is rising to $16.80, and Cupertino, California, where the minimum wage is increasing to $17.20 an hour.
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Advocacy and Activism:
- The article attributes the flurry of minimum wage increases to years of advocacy and protests by groups like Fight for $15, emphasizing the role of worker activism and the impact of the pandemic and inflation on wage discussions.
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Beneficiaries and Impact:
- The record number of pay hikes is estimated to benefit 8.4 million workers, with the Economic Policy Institute (EPI) providing analysis on the average annual raises for full-time workers. EPI also notes that over 2 million parents, including more than a million single parents, will experience a raise.
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Regional Progression Toward $15 Minimum Wage:
- Six states, including California, Connecticut, Massachusetts, New York, Oregon, and Washington, are projected to have the lowest-paid workers making at least $15 an hour by the end of 2023. Additionally, 13 states are adjusting baseline hourly pay to reflect inflation.
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Federal Minimum Wage Stagnation:
- The article touches upon the fact that the federal minimum wage has remained stagnant at $7.25 an hour since July 2009. The Economic Policy Institute underscores the loss of purchasing power over the years, highlighting that when adjusted for inflation, today's minimum wage is comparable to the 1950s.
In conclusion, my expertise in labor economics and wage dynamics allows me to provide a thorough analysis of the concepts presented in the article, offering a nuanced understanding of the factors influencing the pace of U.S. wage growth and the implications for workers and the economy.
