- Employment Law
- November 16, 2022
Colorado Raising Minimum Wage for 2023
On September 13, 2022, Governor Polis made an announcement that as of January 1, 2023, Colorado’s minimum wage is set to increase by more than a dollar from $12.56 to $13.65 per hour. The Colorado Department of Labor and Employment Division of Labor Standards and Statistics (DLSS) issues minimum wage adjustments as part of its annual wage law rulemaking process, pursuant to a voter-approved mandate in the Colorado Constitution that requires the annual adjustment to be in line with current inflation.
“We are building a strong economy that works for all Coloradans,” said Gov. Polis. “This new minimum wage of $13.65 builds upon our work to save Coloradans money, reduce the cost of everyday items, and put money back into the pockets of hardworking Coloradans.”
According to the state, these adjustments are based on the Consumer Price Index (CPI) in the Denver-Aurora-Lakewood Metropolitan Statistical Area, which is calculated and issued by the federal Bureau of Labor Statistics. View the official 2023 Publication And Yearly Calculation of Adjusted Labor Compensation (2023 PAY CALC) Order.
“We are seeing wages increase but real wages are still negative wages. They are not keeping up with inflation,” said Nathan Perry, associate professor of economics at Colorado Mesa University. “You can live off small wage gains as long as the world around you becomes cheaper.”
Denver Going Even Higher
The U.S. is now in the longest period without an increase to the minimum wage. And because of that, cities like Denver, San Francisco and others have passed their own higher pay standards and linked annual increases to inflation.
Denver is raising its minimum wage even further than the state for 2023 to $17.29 per hour starting January 1, 2023. This is due to legislation from the state allowing local governments to raise minimum wage higher than the state’s level. Denver is amongst many other cities raising minimum wage above $17.00 an hour. Minimum wages in Denver for tipped food and beverage workers will increase to $14.27 per hour if they earn at least $3.02 in tips per hour.
This is the first time since Denver City Council passed an ordinance in 2019 that the wage increase is tied to inflation. The city’s goal is to get their lowest earners a better wage and then link annual pay increases to the CPI starting in 2023. This increase coincides with the highest national inflation rate in 40 years at 8.94%. Denver’s minimum wage increase is based on how much consumer prices in the Denver area increase in the first six months of the year compared to a year ago. The city isn’t allowed to change the wage mid-year, according to state statute.
“We know this will put additional burdens on our local businesses,” Mayor Michael Hancock said in a statement. “But this is an important tool to support vulnerable workers across the city.”
Colorado Is Not Alone
States are doing the same across the U.S. as the federal minimum wage has not increased since July 24, 2009. It is currently set at $7.25 per hour.
The highest minimum wage will be paid in Washington, which will increase to $15.74 per hour in 2023. Overall there will be four states with minimum wages at $15 or higher starting in 2023 — California, Connecticut, Massachusetts and Washington.
The lowest, however, is in Georgia and Wyoming, which is $5.15 for employers exempt from the Fair Labor Standards Act, USA Today reported. However, most companies are required to use the federal minimum wage of $7.25.
Overall, at least 25 states are increasing minimum wage in 2023.
See below for a full list of minimum wages across the country.
- Alabama: $7.25, no minimum wage required
- Alaska: Increases from $10.34 to $10.85 per hour in 2023
- Arizona: Increases from $12.80 to $13.85 per hour in 2023
- Arkansas: $11
- California: Increases from $14 to $15.50 per hour in 2023
- Colorado: Increases from $12.56 to $13.65 per hour in 2023
- Connecticut: Increases from $14 to $15 per hour in 2023
- Delaware: Increases from $10.50 to $11.75 per hour in 2023
- Florida: Increases from $11 to $12 per hour on Sept. 30, 2023
- Georgia: $5.15 for employers exempt from the Fair Labor Standards Act, USA Today reported. However, most companies are required to use the federal minimum wage of $7.25.
- Hawaii: $12.00
- Idaho: $7.25
- Illinois: Increases from $12.00 to $13 per hour in 2023
- Indiana: $7.25
- Iowa: $7.25
- Kansas: $7.25
- Kentucky: $7.25
- Louisiana: $7.25, no minimum wage required
- Maine: Increases from $12.75 to $13.80 per hour in 2023
- Maryland: Increases from $12.50 to $13.25 per hour in 2023
- Massachusetts: Increases from $14.25 to $15 per hour in 2023
- Michigan: The minimum wage hike was paused, according to MLive.
- Minnesota: Increases from $10.33 to $10.59 per hour in 2023
- Mississippi: $7.25, no minimum wage required
- Missouri: Increases from $11.15 to $12 per hour in 2023
- Montana: Increases from $9.20 to $9.95 per hour in 2023
- Nebraska: Increases from $9.00 to $10.50 per hour in 2023
- Nevada: Increases from $10.50 to $12 per hour in 2023 if final ballot passes, according to CNBC.
- New Hampshire: $7.25
- New Jersey: Increases from $13.00 to $14.13 per hour in 2023
- New Mexico: Increases from $11.50 to $12 per hour in 2023
- New York: Increases from $13.20 to $14.20 per hour in 2023 ($15.00 for New York City, Nassau, Suffolk and Westchester counties)
- North Carolina: $7.25
- North Dakota: $7.25
- Ohio: Increases from $9.30 to $10.10 per hour in 2023
- Oklahoma: $7.25
- Oregon: Currently $13.50 but will but “adjusted annually based on the increase, if any, to the U.S. City average Consumer Price Index for All Urban Consumers.”
- Pennsylvania: $7.25
- Rhode Island: Increases from $12.25 to $13 per hour in 2023
- South Carolina: $7.25, no minimum wage required
- South Dakota: Increases from $9.95 to $10.80 per hour in 2023
- Tennessee: $7.25, no minimum wage required
- Texas: $7.25
- Utah: $7.25
- Vermont: Expected to increase from $12.55 to $13.18 per hour in 2023, according to Bloomberg Tax calculations.
- Virginia: Increases from $11 to $12 per hour in 2023
- Washington: Increases from $14.49 to $15.74 per hour in 2023
- West Virginia: $8.75
- Wisconsin: $7.25
- Wyoming: $5.15 for employers exempt from the Fair Labor Standards Act, USA Today reported. However, most companies are required to use the federal minimum wage of $7.25.
With many changes to legislation beginning on January 1st, it is important that as an employer, you update your policies and handbooks to include these new changes. One of our Employment Law attorneys can assist you. Contact us today to speak to a member of our team on how we can help get your business up-to-date. Give us a call at (719) 355-8840 or email us at info@businesslawgroup.us.