Which State Has The Highest Minimum Wage? Which States Are At $7.25?

Amid high inflation and a turbulent economy, the U.S. minimum wage has taken on greater relevance in 2022. On Labor Day, and as California Gov. Gavin Newsom signed a groundbreaking on Monday to increase fast-food workers' waged up to $22 an hour, it might be a good time to look at the current state of the minimum wage.

The first minimum wage was established in 1938, as part of the Fair Labor Standards Act.

As of late August, only California has a statewide minimum wage of $15 an hour, while Washington, D.C., has a minimum wage of $16.10.

Alabama, Louisiana, Mississippi, South Carolina, and Tennessee have no state minimum wage laws. Those five states have a $7.25 federal minimum wage.

Alaska

In Alaska, the basic minimum rate is $10.34 per hour. Premium pay goes into effect after eight-hour work days and 40-hour work weeks. Premium pay does not apply to employers with fewer than four employees. Alaska adjusts minimum pay annually based on a formula.

Arizona

Arizona has a basic minimum rate of $12.80 per hour.

Arkansas

Arkansas has a minimum basic rate of $11 for those employers with four or more employees. Premium pay goes into effect after 40 hours.

California

California has a basic minimum rate of $14 for employers with 25 workers or less and $15 for employers with 26 workers or more. The state also has a formula that will adjust the minimum wage annually. California also applies premium pay after designated hours. The new bill for fast-food workers could go into effect in 2023.

Colorado

Colorado has a minimum basic rate of $12.56. The overtime rate depends on the industry, which applies after 12 hours daily and 40 hours weekly. The wage will eventually rise to $13.64.

Connecticut

Connecticut has a $14 basic minimum rate. The state's next raise, to $15 an hour, is set for June 1, 2023.

Delaware

Delaware has a basic minimum rate of $10.50 an hour. The minimum wage adjusts depending on the federal rate. It will rise to $11.75 in 2023 and will jump to $13.25 in 2024.

Florida

Florida has a basic minimum rate of $10 and that rate adjusts annually based on a set formula. The previous minimum wage was $6.79.

Georgia

Georgia has a basic minimum rate of $5.15, though this applies to companies with six or more employees. Employers subject to the federal minimum requirement have to pay employees the federal minimum if it is greater than the state minimum. The federal rate of $7.25 mostly applies and there are calls for a jump to $10.10 an hour.

Hawaii

Hawaii will raise the minimum wage from $10.10 an hour to $12 on Oct. 1. It will eventually reach $18 on Jan. 1, 2028.

Idaho

Idaho has a basic minimum rate of $7.25 per hour.

Indiana

Indiana has a basic minimum rate of $7.25 with premium pay applying after 40 hours per week. The law applies to employers with two or more employees.

Iowa

Iowa has a basic minimum rate of $7.25.

Kansas

Kansas has a basic minimum rate of $7.25.

Kentucky

Kentucky has a basic minimum rate of $7.25. The state also has special overtime laws separate from the minimum wage rate.

Maine

Maine has a basic minimum rate of $12.75. If the federal wage increases beyond the state's, the state will increase it to the same amount.

Maryland

Maryland has a basic minimum rate of $12.50. The minimum wage will increase if the federal minimum increases beyond the state's. Employees under 18 must be paid 75% of the minimum hourly rate.

Massachusetts

As of Jan. 1, Massachusetts has a basic minimum rate of $14.25.

Michigan

Michigan has a basic minimum rate of $9.97 which applies to employers with two or more employees. The minimum wage here will increase per year depending on the unemployment rate not exceeding 8.5%. Workers who are 16-17 years of age will receive 85% of the minimum hourly rate. The minimum wage may soon increase to $12 an hour.

Minnesota

The minimum wage in Minnesota for employers with an annual revenue of $500,000 or more is $10.33. For employers making less annual revenue, the basic minimum rate is $8.42, which also applies to employees under 18. The state's minimum wage is adjusted based on a formula every year.

Missouri

Missouri has a basic minimum rate of $11.15 an hour. From 2019 to 2023, the minimum wage will increase by $.85 until it reaches $12. The state law also exempts employers making less gross annual sales or business done than $500,000.

Montana

Montana requires businesses with more than $110,000 in gross annual sales to pay employees $9.20. Employers with less gross annual sales pay employees $4 if they do not meet federal requirements. Minimum basic rate adjusts based on a formula.

North Carolina

North Carolina has a minimum wage of $7.25. Premium pay applies after 45 hours a week for seasonal amusement or recreational establishments.

North Dakota

North Dakota has a basic minimum rate of $7.25.

Nebraska

Nebraska has a basic minimum rate of $9 when there are four or more employees at a business.

New Hampshire

New Hampshire has a basic minimum rate of $7.25 but will change it if the federal minimum wage changes.

New Jersey

New Jersey has a basic minimum rate of $13 an hour which adjusts annually based on a formula. The state has a separate minimum rate, $11.90 an hour, for seasonal or small employers with fewer than six employees.

New Mexico

New Mexico has a basic minimum rate of $11.50.

Nevada

Nevada has a basic minimum rate of $10.50 for employers who provide no health benefits to employees and $9.50 for employers who do.

New York

New York has a minimum basic rate of $13.20, except in Westchester, Long Island, and New York City, where the minimum is $15. New York's minimum rate will be equal to the federal minimum wage if the federal minimum rises above the state's. The state also has its own overtime requirements depending on industry.

Ohio

In Ohio, for employers with a gross annual receipt of $342,000 or more there is a basic minimum rate requirement of $9.30. Employers who make less than that can pay $7.25. That minimum wage adjusts annually based on a formula.

Oklahoma

In Oklahoma, employers with 10 or more employees at one location and with gross annual sales of $100,000 must pay a basic minimum rate of $7.25. For every other employer, there is a basic minimum rate of $2. The state applies the federal minimum wage rate by reference but federal laws supersede state laws for those employers who it applies to.

Oregon

Oregon has a federal minimum wage of $13.50. The state also bases overtime laws on industry. The minimum wage will adjust annually up until 2022 based on a formula.

Pennsylvania

Pennsylvania has a basic minimum rate of $7.25.

Rhode Island

Rhode Island has a basic minimum rate of $12.25. Premium pay applies to work on Sundays and holidays. Certain other businesses have separate laws that distinguish them from the minimum wage laws of the state. The state plans to reach $15 an hour.

South Dakota

South Dakota has a basic minimum rate of $9.95. The minimum wage in the state adjusts annually based on a set formula.

Texas

Texas has a basic minimum rate of $7.25. However, the state has no wage law that contains current dollar minimums. The state instead adopts the federal minimum wage by reference.

Utah

Utah has a basic minimum rate of $7.25. The state also has no wage law that contains current dollar minimums. Instead, the adoption of the federal minimum is based on administrative action.

Virginia

Virginia has a basic minimum rate of $11 an hour for employers with four or more employees. It is looking to increase to $12 an hour.

Vermont

On Jan. 1, 2022, Vermont boosted its basic minimum rate to $12.55.

Washington

Washington has a basic minimum rate of $14.49. Premium pay does not apply to employees who request time off instead.

Wisconsin

Wisconsin has a basic minimum wage rate of $7.25.

West Virginia

West Virginia has a basic minimum rate of $8.75, which applies to employers with six or more employees at one location.

Wyoming

Wyoming has a basic minimum rate of $5.15, unless an employer is subject to the federal requirement of $7.25.

What are economists saying?

The minimum wage in many states, and the federal minimum wage, are not keeping up with rising costs, according to many economists. The federal minimum wage is at its lowest value since February 1956, according to the Economic Policy Institute. The last time Congress increased the federal minimum wage was in 2009, from $6.55 to $7.25.

"We've gotten into this pattern where we let inflation just eat away at the minimum wage's value instead of doing something to make sure that it's still a more adequate wage for folks," David Cooper, director of the economic analysis and research network at the EPI, told CNBC.