State minimum wage increases announced for 2012

Colorado, Montana, Ohio, Washington and Oregon have each announced increases to their 2012 minimum wages, according to CNN. The triggered increases range from 28 cents to 37 cents per hour. These four states and six others (AZ, FL, MO, NV, OR, and VT) have minimum wages that are linked to inflation (the consumer price index), which means the minimum wage is normally increased each year according to the Department of Labor.  In January 2011, seven of the ten trigger states increased their wages - the three exceptions being Florida, Missouri and Nevada.

Minimum Wage Increases Announced for 2012

Source: CNN

States legislatively set their minimum wage requirements, but federal minimum wage law trumps state minimum wage law. That is, if the state’s wage is lower than the federal rate, the federal rate applies. If the opposite is true – the state rate is higher than the federal rate – the state rate applies.

A total of 45 states have state minimum wage requirements and of those 18 states plus DC have wages set above the federal minimum and 23 have wages set equal to the federal minimum. Four states (AR, GA, MN and WY) each technically have rates set below the federal minimum, but the lower rate only applies to those workers who are exempt from the federal standards (for example: those under the age of 20 may be paid a minimum wage of $4.25 for the first 90 consecutive calendar days of employment). To learn more about minimum wage compliance, check here.

In 2010, 72.9 million American workers over the age of 16 were paid hourly rates, equal to about 58.8 percent of all wage and salary workers.  Of those workers, 4.4 million earned wages at or below the federal minimum - 6.0 percent of all hourly-paid workers.

From 1998 to 2007, the federal wage stood at $5.15.  A series of increases to the wage started in 2008 (due to the Fair Minimum Wage Act of 2007), moving it upward in increments until it reached $7.25 in 2009, the last year it was increased. The state with the highest minimum wage is Washington, at $8.67 an hour. Next year that rate will go up to $9.04.