These are the states with the highest minimum wage starting in January 2025

Get ready for a change in 2025! The states with the highest minimum wages will be different. Thanks to legislation and ballot measures passed, workers in over a dozen states could see their incomes increase as the minimum wage moves up starting early next year.

Just over one percent of workers, or around 870,000 in the US, made $7.25 an hour–the federal minimum wage–or less in 2023. The initiative taken by states to increase their own minimum wages has helped to reduce this number over the last ten years. While nationally the figures might seem low, one must consider that another group of workers is much larger, making just above this amount. However, in twenty states, the lowest hourly rate that can be paid to a worker remains at $7.95; of the total workers paid at or below this wage, 53 percent live in one of these rates.

The benefits for workers across incomes

When the minimum wage increases, the wages of all workers tend to track upward, benefiting from the increase in the wage floor. Between 2016 and 2023, median income in the United States grew by 9.6 percent. However, in states that have passed measures to increase the minimum wage, that figure was 11.51 percent, compared to 8.29 percent in states that do not have a minimum wage or use one set by the federal government. Though a plethora of variables can help explain the differences in income, the power of increasing the minimum wage to help workers in the middle of the income spectrum should not be underplayed.

Take the case of Missouri, which offered one of the least generous increases. In 2018, the state legislature passed a bill increasing the state’s minimum wage from $7.85 to $11 by 2023. Between 2018 and 2023, median annual income grew by 12.93 percent (compared to 7.84 percent nationally over the same period), rising from $69,180 in 2017 before the increases went into effect to $78,290 in 2023.

The states with the highest minimum wages

A total of eleven states, plus the District of Columbia, have minimum wages set at $15 per hour or higher. Washington, DC, leads the country with a minimum wage of $17.50, followed by Washington state, which will see its minimum wage rise to $16.66 on January 1. California ($16.50 - $20 for fast food workers), Connecticut ($16.35), and Hawaii ($16.00) round out the top five.

Where will wages increase throughout the year?

In some cases, like Alaska’s, wages will begin at one level and increase throughout the year. The minimum wage in Alaska will rise to $13.00 per hour in July, though it starts the year at $11.91.

Similarly, in Michigan, the minimum wage will stand at $12.48 by the end of February.

Florida will adjust their minimum wage upward in September to $14.

Many workers remain underpaid with little recourse

However, these higher wages do not often tell the full story. In California in 2023, nearly twelve percent of workers were classified as hourly, and 5.5 percent were paid at or below the federal minimum wage, representing around 48,000 workers. In addition to the exemptions that often allow part-time, tipped workers or agricultural laborers to be paid under the minimum wage, some employers skirt the law and steal from their employees.

In November, the US Department of Labor announced that their investigations found that close to a dozen employers owed their workers more than $3.5 million in backpay because they failed to pay the prevailing wage or illegally denied paying overtime.

In one of the cases, the DoL found that a subsidiary of the defense contractor General Dynamics Corporation paid thirty-six engineers from Mexico “in Mexican pesos below the federal minimum wage rate in violation of the Fair Labor Standards Act.” The subsidiary was mandated to pay $1.4 million in back pay and damages as a result of the investigation.

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