2025 may be a more financially sound year for many Americans. That’s because on January 1 of the new year, the minimum wage for workers in 21 states will climb—some more significantly than others—with more states to follow later in the year.
In 2025, a total of 23 states and 65 cities and counties will raise base pay in a hike that will impact about 9.2 million American workers by a total of $5.7 billion.
Of course, the wage increases will vary widely from state to state and county to county. According to an Economic Policy Institute (EPI) report, California, Colorado, and Washington State are leading the charge when it comes to widely upping minimum wage. “29 cities and counties in California will increase their minimum wages in January, with every locality that is raising their wage reaching at least $17 an hour except in Oakland,” the report states.
In Colorado, four localities will raise the minimum wage, with Denver hitting $18.81/hour. Washington State will see seven localities increase minimum wage—with Tukwila, Washington, reaching the highest in the country at $21.10/hour in 2025. Boulder County is set to reach $25 an hour by 2030.
Other states will climb to $15/hour for the first time in the new year. That’s true for Illinois, Delaware, and Rhode Island. Delaware will make the biggest jump with an increase of $1.75/hour in order to hit the $15/hour mark in 2025.
Of course, not every state is making such notable increases to base pay. Ohio, for example, will only add 25 cents to hourly pay, going from $10.45 to $10.70, due to an inflation adjustment, even though the state hasn’t significantly upped minimum wage since 2007. “According to EPI’s Family Budget Calculator, there is no county where an Ohio worker can earn less than $17.73 an hour and maintain a modest, but adequate, standard of living,” the report notes.
Millions of workers will see bigger paychecks in 2025, either as a direct result of the pay boost or other increases that will come due to company pay structures. Most of the impacted workers (58.2%) will be women. Black and Hispanic workers will see more of a benefit than others, too. Black Americans account for 9.1% workforce in states being pay bumps, but are 11.3% of affected workers. 19.5% are Hispanic, but 38.8% of Hispanic workers will see boosts. And more than a quarter (25.7%) of affected workers are parents.
Experts say that while increases may be moderately helpful, they won’t be overwhelmingly life-altering. “Remember that a full-time worker earning $17 per hour is only earning $35,360 annually pretax,” Yannet Lathrop, NELP’s senior researcher and policy analyst, told USA Today. “Those wage levels won’t make workers wealthy, but they will help with paying for the basics, for a few luxuries (hopefully).”
She added, “Those higher wages may also improve their mental and physical health, their ability to access credit, and may lead to better educational outcomes of their children.”
Federally, minimum wage hasn’t budged from $7.25 an hour since 2009. About 20 states still use that rate, including Georgia, North Carolina, Pennsylvania, and Wisconsin, which were all battleground states in the 2024 election.
The new report estimates that nearly one in five of the millions of workers who will be impacted by the increase in minimum wage next will have household income that puts them below the poverty line. Half (49%), are twice below it.
Find the full report, including each state’s 2025 minimum wage, here.
