By Corinne Murdock |
Minimum wage in Arizona will rise to over $14 an hour in the new year, a 50-cent increase from the previous amount of over $13.
At $14.35, that will make Arizona the state with the ninth-highest minimum wage in the country. Only eight Democratic-led states — California, Washington, New York, Connecticut, New Jersey, Maryland, Massachusetts, and Colorado — outrank Arizona in their minimum wages offered.
Arizona was one of 22 states to receive a minimum wage increase.
The state’s minimum wage adjustment originated with Proposition 206 — referred to as the Fair Wages and Healthy Families Act — passed by voters in 2016 under former Gov. Doug Ducey. At the time of the act’s passage, the minimum wage was about $8 an hour. The act initiated an incremental increase in the minimum wage from $8 in 2016 to $12 an hour in 2020, with all subsequent annual changes based on cost of living increases.
The act exempts individuals employed by parents or siblings, babysitters, state or federal government employees, and small businesses that gross less than $500,000 annually and don’t have to pay a minimum wage per federal law.
Since 2006, municipalities have been allowed to set a local minimum wage higher than the state.
Flagstaff and Tucson both have their own minimum wage ordinances; Flagstaff requires its wage to be at least $2 higher than the state, while Tucson currently has an incremental increase to reach $15 by 2025.
2024 marks the first year Flagstaff will adjust its minimum wage based on cost of living. Tucson will adopt the same schedule after 2025.
According to those parameters, Flagstaff’s minimum wage will rise to $17.40 come January. Tucson was set to reach a $14.25 minimum wage this year according to its schedule, but according to the law will match the state raise to $14.35.
In recent years, Flagstaff has battled with the state in court over its minimum wage schedule. The Arizona Court of Appeals ruled in February that the city would have to pay the state over $1.1 million for its minimum wage ordinance, per a 2019 law requiring annual assessments of municipalities with a minimum wage exceeding that imposed by the state. These assessments review estimated state agencies’ costs attributable to the higher minimum wage.
The federal minimum wage remains at $7.25 an hour, unchanged since 2009. Democrats in the House and Senate are looking to change that with proposed legislation to increase the minimum wage to $17 by 2028.
According to an Economic Policy Institute analysis, the raise would result in an estimated $86 billion annually in wages for over 27.8 million workers, averaging out to about $3,000 more per worker annually. Those millions affected make up about 19 percent of the national workforce.
In Arizona, the proposed federal minimum wage raise would impact roughly 629,000 workers with an average annual increase of over $900.
The Congressional Budget Office (CBO) issued a review of similar legislation which proposed a minimum wage increase of $15 an hour by 2027. CBO estimated that earnings would raise for some, but overall there would be a decrease in employment.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
