Wage Wave 2023: States Step Up as Federal Minimum Stagnates

As we usher in the new year, there’s a wave of change sweeping across the United States – and it’s hitting the wallets of workers in a big way. In a bold move defying the stagnant federal stance, nearly two dozen states and several municipalities are set to hike their minimum wages. This isn’t just a small bump; we’re talking major leaps towards a living wage, with 65 jurisdictions, including 22 states, gearing up for increases. For many, this means reaching or surpassing the $15 per hour mark – a figure once seen as a distant dream for minimum wage advocates.

Later in the year, we’ll see even more action. Three states and 22 localities are also on board for wage hikes. Take Hawaii, for example, where the jump from $12 to $14 per hour is nothing short of monumental. And California? They’re considering a groundbreaking $18 per hour through a ballot initiative next year. But for now, Washington State leads the pack with a whopping $17 per hour minimum.

These changes are set to elevate the average national minimum wage to $10.69 per hour. But let’s not forget the other side of this coin: thirteen states are still clinging to the shockingly low federal minimum of $7.25 per hour. Adjusted for inflation, that’s 40% lower than in 1970. Despite significant increases in worker productivity since then, the inflation-adjusted average minimum wage is still 15% lower than it was five decades ago.

It’s been a staggering 14 years since Congress last raised the federal minimum wage – the longest period without an increase since its inception in 1938. This stagnation isn’t just a number; it’s a reflection of millions struggling with wages that don’t keep up with living costs. This includes those in the gig economy and other sectors where subminimum wages are the norm.

The call for a higher minimum wage resonates with most Americans. A recent Data for Progress poll reveals a striking consensus: 74% believe $7.25 is too low, with over half advocating for a $17 per hour minimum. According to MIT’s living wage calculator, a family’s basic needs require about $25 per hour – a stark contrast to current standards.

While many U.S. workers earn above the minimum, the importance of raising the rate remains crucial. The economy is unpredictable, and without legislative action, we risk sliding backward. As Yannet Lathrop, a researcher at the National Employment Law Project, points out, “You can’t leave policies like the minimum wage to employers… This is a labor standard, not just a matter of what the market dictates.”

As 2023 rolls in, these state-led wage hikes are more than just numbers on a paycheck; they’re a beacon of hope and a call to action. It’s a reminder that when the federal government stalls, states can lead the charge in ensuring fair compensation. This wave of wage increases isn’t just a financial boost; it’s a step towards a more equitable society where every worker earns a wage that reflects their worth and meets their needs.