Each year, states across the nation hike their minimum wages.
Whether rising wage requirements are in response to inflation, higher costs of living, constituent demand or a blend of factors, they affect employers.
Read on to find out whether your payroll will be affected in 2025.
Which state minimum wages are changing in 2025?
While the federal minimum wage won’t be changing in 2025, you may still have to increase your pay for entry-level workers based on state minimum wage changes.
Check the list below to see if your state is increasing its minimum wage in 2025. Note that some states automatically adjust their minimum wage for inflation each year. Unless otherwise noted, the new wage requirements take effect Jan. 1, 2025.
| State | Change |
|---|---|
| Alaska | Alaska’s minimum wage increases annually using an inflation-based cost of living adjustment. It is expected to rise to $13 from $11.73 based on reports from Alaska Public Media. Note that the state is currently divided over a ballot measure that would increase the minimum wage to $15 an hour by 2027. |
| Arizona | Arizona’s minimum wage will increase to $14.70 per hour, up from $14.35. Flagstaff’s minimum wage will increase to $17.85 in the new year. |
| California | California’s minimum wage will increase to $16.50 per hour. |
| Colorado | Colorado’s minimum wage will rise from $14.42 to $14.81. The hourly tipped minimum will rise from $11.40 to $11.79. Some cities, including Denver, will maintain their own minimum wages tied to inflation. |
| Connecticut | Connecticut’s minimum hourly wage will increase to $16.35 in 2025. This is in accordance with a state law passed in 2019 to implement five annual increases in the hourly wage. Further increases will be tied to the U.S. Department of Labor’s Employment Cost Index. |
| Delaware | Delaware’s hourly minimum wage will increase incrementally over a period of years. In 2025, it will rise to $15. |
| Florida | Florida’s minimum wage will rise to $14 on Sept. 30, 2025. |
| Illinois | Illinois’ minimum wage will rise from $14 to $15 per hour. |
| Indiana | Beginning Jan 1, 2025, Indiana’s minimum wage will rise to $10.07 |
| Iowa | Iowa’s minimum wage is expected to rise to $15 per hour in 2025. |
| Maine | Maine’s minimum wage will increase to $14.65 per hour effective at the beginning the year. |
| Maryland | Maryland’s minimum wage will increase to $16 per hour for employers of all sizes starting at the beginning of the year. As of 2024, the state has departed from its previous wage-by-employer-size structure. |
| Massachusetts | The minimum wage for small employers will rise to $15 per hour. For large employers, it will rise to $18 per hour. “Large employers” are those with 26 or more employees. |
| Michigan | Michigan’s minimum wage is set to increase from $10.33 to $12.48 per hour. The state’s tipped minimum wage will rise to $5.99 per hour, or 48% of the standard minimum wage. |
| Minnesota | Beginning Jan 1, 2025, all Minnesota employers must raise their minimum wage from $10.85 to $11.13 per hour to account for inflation. In 2024, legislation was passed to eliminate minimum wage “tiers” for large versus small employers. Instead, a uniform minimum wage was implemented. Note that this state minimum wage does not apply to work performed in certain cities, including Minneapolis or St. Paul. Those cities have higher minimum wages. |
| Mississippi | Beginning Jan 1, 2025, the state’s minimum wage will rise to $15 per hour. |
| Montana | Montana’s minimum wage will increase to $10.55 from $10.30, representing a cost of living adjustment. |
| Nebraska | Nebraska’s minimum wage will increase from $12 to $13.50 an hour. It will continue to rise $1.50 annually, reaching $15 an hour in 2026. |
| New Jersey | New Jersey’s minimum wage will rise to $15.49 an hour, up from $15.13. |
| New York | New York’s minimum wage will rise to $15.50 beginning in 2025. Minimum wages will also rise to $16.50 an hour in New York City, Long Island and Westchester. Wages will continue to rise by $.50 annually in 2026. |
| Ohio | The minimum wage in Ohio will rise from $10.45 to $10.70. The tipped workers’ wage will rise from $5.25 to $5.35. |
| Oregon | Beginning July 1, 2025, Oregon’s minimum wage is expected to rise across all counties. The state’s standard minimum wage will be $14.70 per hour. The minimum wage for the Portland metro area will be set at $15.95 per hour. And for Oregon’s classified nonurban areas, the minimum will be $13.70 per hour. |
| Rhode Island | Rhode Island’s minimum wage will increase from $14 to $15 an hour. |
| South Carolina | In a landmark decision for the state, minimum wages will rise to $17 per hour starting Jan. 1, 2025. |
| South Dakota | South Dakota’s minimum wage will increase to $11.50, up from $11.20. |
| Vermont | Vermont’s minimum wage will rise from $13.67 per hour to $14.01 per hour at the beginning of the year. |
| Virginia | Virginia’s minimum wage will rise to $12.41, up from $12. |
| Washington | Washington’s minimum wage will rise to $16.66 per hour, up from $16.28 in 2024. |
| West Virginia | West Virginia’s minimum wage will rise to $11 per hour in 2025. Thereafter, it will increase by $1 each year. |
Which states are keeping their minimum wages in 2024?
All other states are maintaining their current minimum wages:
- Alabama
- Arkansas
- District of Columbia
- Georgia
- Hawaii (But note that Hawaii’s minimum wage is set to rise to $16 per hour in 2026.)
- Idaho
- Kansas
- Louisiana
- Nevada
- New Hampshire
- New Mexico
- North Carolina
- North Dakota
- Oklahoma
- Pennsylvania
- Tennessee
- Texas
- Utah
- Wisconsin
- Wyoming
- Missouri
Is the federal minimum wage changing in 2025?
So far, there haven’t been any reports about the federal minimum wage changing in 2025. As of this writing, it appears that the federal minimum wage will remain at $7.25 per hour. This has been the case since 2009.
If you have federal contract workers
The minimum wage for federal contract workers is increasing to $17.85 per hour on Jan. 1, 2025. This change is based on the Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). As many small businesses do not engage with federal contract workers, this change is most likely to affect large companies only.
If you have tipped employees
If you have tipped employees, the federal minimum wage for them is $2.13 per hour. If the amount of tips a worker receives in addition to $2.13 per hour does not reach at least $7.25 per hour, you must pay to make up the difference.
Stay on top of your compliance obligations
With the rise of remote and hybrid work, it’s more important than ever to stay on top of the minimum wage rules in the states where you operate and employ workers. If you have any questions or concerns about your compliance, contact your benefits adviser or legal counsel.
Need more information?
For support on this topic contact OneGroup HR Consulting at HR Consulting at [email protected]. They can provide best practices on reassignment, including planning, training, communication, and compliance.
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