Millions of Americans will see their pay increase in the new year, with nearly 20 states set to enact minimum wage hikes across the country. For millions, the pay increase will help to offset elevated prices and provide some relief from continuing economic woes.
Minimum wage hikes for 19 states
A total of 19 states, as well as several cities, will implement minimum wage increases on Jan. 1. The raises will include both Democratic-led and Republican-led states. Washington will have the highest minimum wage of any state, with workers there receiving at least $17.13 an hour. New York will be a close second, setting a minimum of $16 per hour for its workers. The other 17 states enacting minimum wage hikes are Arizona, California, Colorado, Connecticut, Hawaii, Maine, Michigan, Minnesota, Missouri, Montana, Nebraska, New Jersey, Ohio, Rhode Island, South Dakota, Vermont and Virginia.
Millions set to receive higher wages
The changes will impact over 8 million workers, according to the Economic Policy Institute. Notably, the EPI estimates that 2026 will see more workers living in states with a minimum wage of $15 or higher than workers living in states where the minimum wage is $7.25, the lowest allowed by federal law. In addition to changes at the state level, nearly 50 cities and localities will also raise their minimum wages. Dozens of localities in California and Washington will increase their wages above $20 per hour, while New York City will raise its minimum wage to $17 per hour.
Economic struggles continue for many
These minimum wage hikes are not unusual; in 2025, approximately 23 states raised their minimum wages. In addition to those set to implement wage hikes on New Year’s Day, other states, including Alaska, Florida and Oregon, are set to raise wages later in 2026. On the other hand, many states, including most of those located in the South, will either continue to have no minimum wage or maintain state wages below the federal minimum. Those states will all have a de facto minimum wage of $7.25 per hour, the federal minimum set in 2009. Pressures to raise worker pay come as the country continues to deal with inflation, causing a decline in real wages. Slow job growth, exacerbated by deep federal job cuts under the Trump administration, has also worsened economic conditions for many.
For now, at least 8 million people are set to see their wages increase on Jan. 1. This will make life a bit easier for these workers, even as the country as a whole deals with elevated prices, sluggish job creation and other economic woes.