California\u2019s statewide minimum wage is set to rise next year.<\/p>\n
Starting on Jan. 1, 2027, the statewide minimum wage will rise to $17.40 an hour, an increase Gov. Gavin Newsom boasted about on Friday.<\/p>\n
Newsom \u2014 who has been eyeing a 2028 presidential run \u2014 said in a statement that California\u2019s fiscal policies helped turn the state into \u201cone of the strongest economies in the world\u201d while the Trump administration and the Republican-led Congress fail to address \u201ceveryday cost pressures for working families.\u201d The federal minimum wage has remained at $7.25 per hour since 2009.<\/p>\n
\u201cFor years, Donald Trump and Republicans have blocked efforts to raise the federal minimum wage while handing tax breaks to billionaires and big corporations,\u201d Newsom said. \u201cCalifornia has chosen a different path \u2014 one that rewards work, grows the economy, and puts working families first.\u201d<\/p>\n
Not everyone agreed. Republican gubernatorial candidate Steve Hilton took to social media on Friday to decry the minimum wage increase as an \u201cattack on workers\u201d that will \u201ccrush small businesses.\u201d<\/p>\n
The current minimum wage in California for all employers is $16.90 an hour, though some workers must be paid more to comply with city and county rules and other state laws.<\/p>\n
California\u2019s minimum wage automatically increases each year to keep pace with inflation. The current system was established in 2016, when then-Gov. Jerry Brown signed<\/a> into law a first-in-the-nation<\/a> plan to gradually boost the state\u2019s hourly minimum wage to $15 an hour, then adjust the wage annually based on inflation starting in 2024.<\/p>\n \u201cThis is about economic justice, it\u2019s about people,\u201d Brown<\/a> said during the bill signing.<\/p>\n The specific amount of the minimum wage increase is tied to inflation \u2014 as measured by the federal consumer price index \u2014 and capped at 3.5%, according to state law. The state director of finance is responsible for calculating the adjusted minimum wage on or before Aug. 1 each year.<\/p>\n California has the highest minimum wage out of all 50 states, according to the governor\u2019s office. (Only Washington, D.C.\u2019s, minimum wage ranks higher<\/a>, at $18.40.) <\/p>\n The state in 2024 raised minimum wage for fast-food workers to $20 an hour.<\/a> The fast-food wage requirement applies to chains with more than 60 locations nationwide.<\/p>\n Researchers have been split <\/a>on the economic impacts of the pay increase for fast-food workers, which chains like Pizza Hut and Cinnabon<\/a> have fought. (Earlier this year, a major Carl\u2019s Jr. franchisee<\/a> cited the $20 fast-food minimum wage when he applied for bankruptcy protection.)<\/p>\n California also has higher minimum wages for healthcare workers<\/a> at large facilities as a result of a union-backed bill Newsom signed in 2023. Under the legislation, many healthcare workers\u2019 minimum wages in July<\/a> rose from $24 an hour to $25 an hour.<\/p>\n Some cities in California, including Emeryville and West Hollywood, have opted to impose even higher city minimum wages exceeding $20 per hour.<\/p>\n Most states have minimum wages above the federal minimum. Five Republican-led states \u2014 Alabama, Louisiana, Mississippi, South Carolina and Tennessee \u2014 do not have an independent state minimum wage and default to the federal minimum.<\/p>\n