WASHINGTON: The minimum wage will rise in 20 states and the District of Columbia on January 1 (Thursday), as laws and automatic adjustments are made with the start of the new year.

In nine states, the hike will be automatic, an adjustment made to keep the minimum wage in line with rising inflation. But in 11 states and DC, the rise is the result of legislative action or voter-approved referenda, according to the left-leaning Economic Policy Institute. Two more states — Delaware and Minnesota — will get legislatively driven hikes later in the year.

Twenty-nine states will have minimum wages above the federal minimum of $7.25.

The size of the hikes range from 12 cents in Florida to $1.25 in South Dakota. Among those states hiking the minimum wage, Washington State’s will be highest at $9.47. Oregon’s is next at $9.25, followed by Vermont and Connecticut at $9.15. Massachusetts and Rhode Island will have $9 minimum wages.

Of the states where the minimum wage is rising due to legislative or voter action, five — Alaska, Michigan, Minnesota, South Dakota, Vermont — and DC will also newly implement inflation indexing, bringing the number of states that tie future minimum wage hikes to inflation to 15. The minimum wage hikes will have a direct impact for 2.5 million workers who currently earn less per hour than the new minimum wage.

Economic Policy Institute estimates that an additional 1.9m people would be affected indirectly, as employers adjust their pay-scales upward. (That estimate counts those with hourly wages between the new minimum wage and the new wage plus the size of the hike. In other words, if a minimum wage rises from $8 to $9, the institute assumes everyone currently earning $9 to $10 will be indirectly affected.)

By arrangement with Washington Post-Bloomberg News Service

Published in Dawn, December 28th, 2014

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