As we enter the new year, minimum-wage workers in 22 states can expect a welcomed boost in their paychecks. This positive change is estimated to impact approximately 9.9 million workers, according to the Economic Policy Institute (EPI). The collective effect of these wage increases is projected to add an impressive $6.95 billion in additional pay.
In addition to the 22 states, 38 cities and counties will also raise their minimum wages above state minimums on January 1. However, it’s important to note that 20 states will maintain the federal minimum wage of $7.25 per hour, as reported by the Department of Labor.
NPR adds, shockingly nearly half of the 17.6 million workers earning less than $15 an hour reside in these 20 states that have adhered to the unchanged federal minimum wage since 2009. Meanwhile, the cost of living has skyrocketed, with a dollar in 2023 having only around 70% of the purchasing power it had in 2009, according to the Bureau of Labor Statistics consumer price index.
While the U.S. economy has shown resilience in terms of retail sales, job numbers, and a declining inflation rate, those earning minimum wage have faced increasing difficulties in meeting basic needs such as rent and groceries. The rising cost of living has forced many Americans to deplete their savings and take on more debt.
The upcoming wage increase will have a significant impact on various groups. According to EPI data, nearly 58% of the workers benefiting from this raise are women, with 9% being Black and almost 38% being Hispanic. Over a quarter of these workers are parents, which could greatly improve their standard of living, especially considering that almost 20% of minimum-wage workers currently have incomes below the poverty line.
In July, Senate Democrats introduced the Raise the Wage Act of 2023, aiming to gradually increase the federal minimum wage to $17 per hour by 2028. This proposed legislation could bring about lasting change for workers across the country, ensuring fair compensation that keeps up with the rising costs of living.
