The federal minimum wage has remained at $7.25 per hour since 2009, but workers in several states will be making up to $2 more than the federal minimum thanks to automatic adjustments enacted to compensate for inflation.
In Washington State, where the minimum wage increased to $9.19 per hour on January 1, 2013, high school student Miranda Olson is getting closer to her goal of purchasing a black Volkswagen Beetle. “It’s not much, but it’s something,” Olsen said of the increase. She works in a bakery in Olympia. “Every bit helps.”
Many workers around the country won’t be as lucky as the ones in Washington State, and nine other states, including: Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Rhode Island and Vermont. Workers one state over in Idaho, for example, will make nearly $2 per hour less in 2013.
Automatic minimum wage increases designed to compensate for inflation have steadily pushed up salaries in some states, even through the recession, expanding the pay gap between areas that make annual adjustments and those that don't. Of the 10 states that will increase the minimum wage at the start of the year, nine did so automatically to adjust for inflation.
Paul Sonn, legal co-director at the National Employment Law Project, said he hopes more states will start looking at automatic adjustments as the economy recovers. He said the model — which Washington state first adopted in 1998 — helps avoid sudden jolts as states try to catch up to their peers.
"We think there's a case that it's better for everyone, including the business community, to have predictable, regular, small increases every year," Sonn said.
States, such as Idaho, North Carolina, Georgia, South Carolina, and many others follow the federal minimum wage of $7.25 per hour, either because they've tied their minimum wage to that threshold or because the state-enacted minimum is lower than that.
Groups like the National Restaurant Association oppose further increases in federal or state minimum wages, arguing that it's an ineffective way to reduce poverty and forces business owners to cut hours, raise prices or lay off workers.
What is the Minimum Wage in your State for 2013?
Alabama: $7.25 Alaska:$7.75
Delaware: $7.75 District of Columbia: $8.25
North Carolina: $7.25
North Dakota: $7.25
New Hampshire: $7.25
New Jersey: $7.25
New Mexico: $7.50
New York: $7.25
Puerto Rico: $6.55
Rhode Island: $7.75
South Carolina: $7.25
South Dakota: $7.25
West Virginia: $7.25