New Year to bring higher minimum wages in record number of states and cities

The new year brings new pay hikes for hundreds of thousands of workers making the least that's legally allowed by local minimum wages, with a record number of cities, counties and states raising their hourly wage minimums — many of them hitting or surpassing $15 an hour.  

On January 1, 2022, the minimum wage will rise in 21 states and 35 cities and counties, with that hourly floor hitting or surpassing $15 in 33 of those jurisdictions, according to an analysis released this month by the National Employment Law Project, or NELP, which advocates for low-wage and unemployed workers. 

Additional states and localities will follow suit later in the year —17 of them to $15 or more, according to NELP. All told, 25 states and 56 municipalities will raise their minimum wage over the course of 2022, a record high of 81 jurisdictions. 

The higher wages come amid worker shortages and ongoing activism on the labor front. The coming year will also mark the 10-year anniversary of the grassroots campaign by fast-food workers demanding $15 an hour and a union.

Even as the minimum wage remains frozen in much of the country — the federal rate has been $7.25 since 2009 —corporations including Hobby Lobby are upping pay, with the crafts chain offering $18.50 an hour to full-time workers as of January 1.  

"Faced with a tight labor market, employers will have to act quickly in order to retain discontented workers," Rebecca Dixon, NELP's executive director, said in a statement. 

Those due to receive pay increases as of Saturday include workers now making at least $12 an hour in three states: Arizona (which is hiking its base rate to $12.80 from $12.15), Colorado (where the minimum is rising to $12.56 from $12.32)  and Maine (where it'll be $12.75, an increase of 50 cents). 

In Delaware and Illinois —two states on course to pay workers at the bottom rung of the earnings ladder $15.00 an hour by 2025 — the hourly base is rising to $10.50 and $12, respectively, when the new year lands. 

Minimum wage earners in Ohio and South Dakota are getting hourly increases of 50 cents when 2022 begins, boosting the rate in the former to $9.30 and the latter to $9.95.

The minimum wage in Connecticut is going up a buck to $14 an hour as of July 1, 2022. Low-wage earners now making $10 an hour in Florida will also see a $1hourly increase on September 30, 2022.  

Workers in Flagstaff, Arizona, will make an hourly minimum of $15.50 when the new year rolls in, a level that is slated to be surpassed in a slew of other towns and cities, most of them in California. In Sunnyvale, California, for instance, workers will be making an hourly minimum of $17.10 when 2022 begins. 

SeaTac, Washington, is increasing its living wage rate 5.83% to $17.54, effective January 1, 2022. The mandatory annual adjustment is calculated using the consumer price index for urban wage earners and clerical workers for the 12 months prior to September 1, the city noted in announcing the new rate in November. 

Even so, 20 states have not raised their wage floors above the federal level for more than a decade, with that minimum stalled at $7.25 an hour since Congress last increased it in July 2009. The federal tipped wage has been stuck at $2.13 since 1991.

The decades of inaction is at odds with much of the public: A CBS News poll over the summer found that 71% of Americans support hiking it. Another 17% believed the minimum should stay where it is, 4% thought it should be less than $7.25 and 8% thought the minimum should not exist.

Frontline employees like grocery clerks and retail workers have seen wages grow at their fastest pace in years, but rising prices means those seemingly robust wage gains amount to "pennies" an hour once inflation is included, according to an analysis from the Brookings Institution. 

"The living wage is closer to $18 an hour," said Molly Kinder, fellow at Brookings Metro and a co-author of the new study on wages for frontline workers.

If the minimum wage had kept pace with the growth of the U.S. economy over the last 50 years, it would be nearly $26 an hour today, or more than $50,000 a year in annual income, as one economist has noted.

"That's roughly what the minimum wage would be today if it had kept pace with productivity growth since its value peaked in 1968," wrote Dean Baker, senior economist at the left-leaning Center for Economic and Policy Research, in a recent blog post.