Raising the living standard for citizens is always a win in our books, so we’re happy to report that some states are raising the minimum wage in 2025. The list of US-based wage hikes in 2025 is a long one, as many states are making changes to the bottom line to support their workers through minimum wage jobs. Some areas have already witnessed a wage hike by the state earlier this year, but others will soon catch up in July or later.
Some of the changes, for example, Oregon’s wage increase in July, will differ between areas, but for the most part, the minimum wage hikes promised will apply uniformly throughout the region.
Employers operating in these states will need to prepare for the upcoming changes, and their HR and accounting teams will need to be on top of all the adjustments necessary to ensure the switch occurs smoothly. Let’s breakdown which states are raising the minimum wage this year.
Many states are raising the minimum wage in 2025, but some worry that the improvements are insufficient to keep up with the changing times. (Image: Pexels)
Listing the States Raising Minimum Wage in 2025
The federal minimum wage in the United States for nonexempt employees as set by the Fair Labor Standards Act (FLSA), remains fixed at $7.25 per hour. The federal minimum wage has not changed since 2009, despite multiple calls to bring the number up across the country. There are efforts by senators to raise the federal minimum wage standard to $17 per hour over the next five years, but the move has faced considerable resistance from various parties.
While the push for new minimum wage laws at the federal level continues via the “Raise the Wage Act,” it is left to the states to adjust for inflation and periodically bring the minimum wage up higher to afford its citizens a livable income.
Upcoming State Wage Increases in 2025
Tracking the wage hikes by state is important for employers and employees so both know what changes to make in upcoming months. Depending on the state wage increases in 2025, employers can then plan ahead to manage their expenses and hiring plans for the rest of the year.
These US states are set to execute the minimum wage increases in 2025.
Alaska:
- Minimum wage will go up to $13 per hour from July 1, 2025
- By July 1, 2027, the minimum wage should increase to $15 per hour
Oregon:
- Increase to $15.05 per hour from July 1, 2025 but it will vary depending on location
- Portland Metro Area will set the minimum wage at $16.30 per hour
- Non-urban regions will have a minimum wage of $14.05 per hour
Florida:
- Increase to $14 per hour on September 30, 2025
- Goal to reach $15.00 per hour in 2026
Some jurisdictions within prominent states are also raising the minimum wage later in 2025.
- Santa Fe, New Mexico: Increased to $15 per hour, from March 1, 2025
- Los Angeles County, California: Increase to $17.81 per hour from July 1, 2025
- San Francisco, California: Increase to $19.18 per hour from July 1, 2025
- St. Paul, Minnesota: Increase to $15 and $13.25, for small and micro businesses respectively, effective July 1. The minimum wage for macro and large businesses was raised to $15.97 per hour in January
- Washington, D.C.: Increases to $17.95 on July 1, 2025
States That Have Already Raised Minimum Wage in 2025
Many US states increased the minimum wage for workers earlier in the year. A majority of these states adjusted the minimum wage annually according to the Consumer Price Index (CPI) but some also brought in legislation to support the hike. Many of these states made the change on January 1, 2025, while some made the switch later in the year.
- Michigan: Increased to $12.48 per hour on February 21, 2025
- Delaware: Increased to $15 per hour
- Illinois: Increased to $15 per hour. For tipped workers, it increased to $9 per hour
- Rhode Island: Increased to $15 per hour
- California: Increased to $16.50 per hour. Specific increases were made for healthcare and fast-food workers
- Nebraska: Increased to $13.50 per hour. Tipped workers earn a base pay of $2.13 per hour, and their total earnings with gratuities included must equal or exceed $13.50 per hour
- Arizona: Increased to $14.70 per hour, with different regulations for tipped employees in Flagstaff and Tucson
- Montana: Increased to $10.55 per hour from $10.30 per hour, with exceptions for small business not covered by FLSA
- Colorado: Increased to $14.81 per hour for non-tipped workers and $11.79 per hour for tipped workers
- Connecticut: Increased to $16.35 per hour
- Maine: Increased to $14.65 per hour
- Missouri: Increased to $13.75 per hour
- New Jersey: Increased to $15.49 per hour barring exception to some categories
- New York: Increased to $16.50 per hour in New York City, Long Island, and Westchester County, and $15.50 per hour in the rest of the state. There are exceptions for tipped service and food service employees
- Ohio: Increased to $10.70 per hour for non-tipped employees and $5.35 per hour for tipped employees
- South Dakota: Increased to $11.50 per hour. Tipped workers earn a base pay of $5.75 per hour, and their total earnings with gratuities included must equal or exceed $11.50 per hour
- Vermont: Increased to $14.01 per hour. Tipped minimum wage increased from $6.84 to $7.01 per hour
- Virginia: Increased to $12.41 per hour
Which States Have Minimum Wages Higher Than $15 per Hour?
There are currently 10 states which have a minimum wage of $15 or higher: California, Connecticut, Delaware, Illinois, Maryland, Massachusetts, New Jersey, New York, Washington and Rhode Island. Washington, D.C has the highest minimum wage in the country at $17.50 per hour. However, some healthcare facilities and fast food workers in California have higher minimum wages above $20 per hour.
Tracking the US Wage Hikes in 2025 Is Essential for HR
Multiple states raising the minimum wage in 2025 did so due to annual adjustments keeping the CPI in mind, while others made changes to better support workers or due to voter-passed ballot measures that encourage the update.
Federal contractors are seeing a reduction in the minimum wage regulations in the US, but the changes for other employees are largely trending upwards. The impact of the changing minimum wage on businesses will only be clear when we look at the revenue and expense numbers at the end of the year.
While a section of insiders believe that raising the minimum wage too high will lead to layoffs and job cuts as employers begin to balance out their expenses, for the most part, it is changing lives for the better. Employees with better livable wages are happier and more productive, and they also contribute to the economy better by spending more freely on resources.
The art of raising wages in a timely manner takes some work to perfect, but with careful planning it isn’t impossible to execute.
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