Minimum wage increases expected in 18 states in January

Economic Indicators FOXBusiness

(AP)

Beginning on January 1, workers in a large number of cities and states across the nation should expect a pay bump as new minimum wage policies go into effect.

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Eighteen states and 20 cities are scheduled to raise minimum wages on the first day of the New Year, according to the National Employment Law Project (NELP), a worker advocacy group.

As of January 1, California’s minimum wage will increase to $11 per hour from the current level of $10.50 per hour for businesses with 26 employees or more. In New York City, larger employers will be required to pay employees a minimum wage of $13 per hour as of Dec. 31, while minimum wage in the state as a whole will rise to $10.40 on the same date.

In Rhode Island and Hawaii, where campaigns have already been proposed to increase the minimum wage to $15 per hour over the next few years, the minimum wage will be raised to $10.10 during 2018. In New Jersey, the minimum wage will rise to $8.60, and in Vermont to$10.50.

Later in 2018, three additional states will implement a wage hike, according to NELP.

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The campaign for a $15 minimum wage, and rising wages overall, has been divisive. Earlier this year, a study conducted by the Employment Policies Institute (EPI), which analyzed employment trends from 1990 through 2017, found that each 10% increase in the minimum wage in California has resulted in a corresponding 2% decline in employment for affected employees. The impact was larger, 5%, for lower-paid workers. By those estimates, the EPI projects that the pending $15 minimum wage hike would cost California 400,000 private sector jobs, with heavy losses in both the foodservice and retail sectors.

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On the flip side, the Institute for Research on Labor & Employment (IRLE) at U.C. Berkeley, found that a higher minimum wage would actually add a small amount of jobs to the state economy by 2023. Without the increase, IRLE forecasts employment would grow 1.4% annually. The minimum wage increase would raise employment by 0.1%, equal to about 13,000 jobs, by 2023, according to the group’s study.

The Republican Party, which passed sweeping tax reform in late-December, is hopeful that its new law will spur companies to increase wages for workers on their own accord.

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