A total of 12 states will increase their minimum wages on the first day of 2016, with even more states to follow throughout the year ahead.
The last time the federal minimum wage of $7.25 an hour was increased was 2009. Nevertheless, states and even some cities have gone ahead with their own minimum wage laws. Currently 29 states and the District of Columbia have a minimum wage higher than what the federal government requires. The year ahead is full of even more minimum wage increases on the state level.
Alaska, Arkansas, California, Colorado, Connecticut, Hawaii, Massachusetts, Michigan, Nebraska, Rhode Island, South Dakota and Vermont are all scheduled for minimum wages increases on Jan. 1. Additionally, New York and West Virginia will be increasing their own minimum wages Dec. 31, according to Business and Legal Resources.
California and Massachusetts will have the highest Jan. 1 increase at $10.00 per hour. While the District of Columbia will have the highest increase in 2016 on July 1 at $11.50 per hour. Several states including Arkansas, Connecticut, Massachusetts, Michigan and Vermont are scheduled to increase their minimum wage again at the start of 2017. Minimum wage legislation is often designed to phase in overtime to help mitigate economic problems.
The question of whether its a good idea to increase the minimum wage has been a significant issue. While supporters say it helps the poor by allowing them to more easily afford basic necessities, critics say it may actually hurt the poor by limiting job opportunities.
For supporters, the increased spending can help stimulate economic activity. Critics, however, argue many businesses have few options to offset the additional cost of labor. Employers have been known to reduce hours worked or reduce the number of employees they have. Those new to the workforce or with low-skills are most likely to be cut first.
Some of the biggest increases are seen on the city level. “The Fight for $15” movement has been at the forefront of pushing for a $15 an hour minimum wage. Seattle led the way in passing the $15 minimum wage back in June 2014. San Francisco and Los Angeles followed not long after. Since then, many more cities have enacted their own $15 minimum wage. Like on the state level, each local ordinance is designed to phase in overtime.
New York, Massachusetts and Florida have all been considering their own $15 an hour proposal. New York was able to unilaterally enact a $15 minimum wage but only for fast-food and public sector employees. Gov. Andrew Cuomo will need legislative approval in order to pass a statewide increase for all industries.
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