States in 2014 will address increasingly difficult labor issues, including concerns over raising the minimum wage. President Obama and some members of Congress have called for an increase in the federal minimum wage, but some states already have taken action.
As of Jan. 1, 2014, the minimum wage increased over 2013 rates in 13 states—Arizona, Colorado, Connecticut, Florida, Missouri, Montana, New Jersey, New York, Ohio, Oregon, Rhode Island, Vermont and Washington. Increases ranged from 10 cents an hour in Arizona, Montana and Ohio, to $1 an hour in California and New Jersey. California’s minimum wage will increase from $8 an hour to $9 an hour later in July. More states are likely to consider the issue in 2014.
The federal minimum wage is $7.25 an hour, and 21 states set a higher minimum wage than the federal rate; 10 states link the minimum wage to a consumer price index. Washington has the highest minimum wage at $9.32 per hour.
Minimum Wage at Its Peak
The minimum wage reached its peak—when adjusted for inflation—in 1968 when it was raised from $1.40 to $1.60 per hour. That’s equal to $10.74 in 2013 dollars, or $3.49 more than the current federal rate of $7.25. For comparison, someone working full time and earning the current federal minimum wage has an annual salary of $15,080. If the minimum wage had kept pace with inflation since 1968, that same person would be earning an annual salary of $22,339—a 48 percent difference. Although 21 states have a minimum wage higher than the federal rate, the state with the highest rate—Washington—still falls more than a dollar shy of hitting the inflation-adjusted high of 1968.