14 States Will Raise Their Minimum Wage New Year's Day

| by Robert Fowler
Protest In New York City For Raising The Minimum WageProtest In New York City For Raising The Minimum Wage

Starting Jan. 1, 2016, 14 U.S. states will have bumped up their minimum wage while certain cities and counties will introduce proposals to raise wages as high as $15 per hour.

Some of the wage hikes will be small, such as a 5 cent bump in South Dakota, while some states will be adding $1 to their minimum wage. California and Massachusetts will become the first states to reach a minimum wage of $10, the highest in the country, The Huffington Post reports. The federal minimum wage is $7.25 an hour.

As the New Year begins, these will be the new minimum wages for the participating states:

Alaska with $9.75, Arkansas with $8.00, Colorado with $8.31, Connecticut with $9.60, Hawaii with $8.50, Michigan with $8.50, Nebraska with $9.00, New York with $9.00, Rhode Island with $9.60, South Dakota with $8.55, Vermont with $9.60 and West Virginia with $8.75.

Increasing the minimum wage has become an increasingly popular economic model after years of everyday Americans being squeezed by stagnant wages coupled with an escalating cost of living. The federal minimum wage has remained at $7.25 since 2009.

While states are incrementally raising wages, several cities and counties are setting their sights on $15 hourly, with 14 approving of the measure this year with 13 set to consider the huge pay bump in 2016, CNN reports.

The effectiveness of the minimum wage is heavily contested between Democratic and Republican lawmakers. For example, Sen. Bernie Sanders of Vermont has made a federal minimum wage of $15 a major feature of his 2016 presidential platform, arguing that a high minimum wage is necessary to help American families keep up with the modern cost of living.

Conservatives argue that hiking up the minimum wage is a well-meaning but ineffective solution to income inequality that would discourage free enterprise and job hires.

A recent study by economist David Neumark estimates the job losses resulting from higher minimum wages has been underestimated, reports the Federal Reserve Bank of San Francisco.

Neumark concludes that high minimum wages could send ripples across the American economy, writing “the overall body of recent evidence suggests that the most credible conclusion is a higher minimum wage results in some job loss for the least-skilled workers -- with possibly larger adverse effects than earlier research suggested."

While the effectiveness of an increased minimum wage remains contested, states will continue to put the economic theory to the test.

If you are a minimum wage-earner in one of the listed states, you’ll be getting a raise soon.

Sources: CNN, Federal Reserve Bank of San Francisco, The Huffington Post / Photo credit: The All-Nite Images/Flickr