As of January 1, 2026, the United States will experience a new wave of minimum wage increases across nearly 20 states, affecting the earnings of millions of workers from Arizona to New Jersey. These increases stem either from inflation-linked adjustments or from previously approved phased wage-increase plans.
According to the Economic Policy Institute (EPI), about 8.3 million workers will benefit from these increases, generating approximately $5 billion in additional income over the next year.
$15 an Hour Becomes the New Wage Benchmark
For the first time, the number of workers living in states that guarantee a minimum wage of $15 per hour will exceed those earning the federal minimum wage of $7.25, a rate that has remained unchanged since 2009 and has lost more than 30% of its purchasing power due to inflation.
As reported by ABC News, Washington State will become the state with the highest minimum wage, where workers will earn $17.13 per hour.
Workers in New York will receive the second-highest minimum wage, with the state setting a $17-per-hour rate for employees in New York City, Long Island, and Westchester. Outside these regions, workers across New York State will earn at least $16 per hour.
In California, 29 local jurisdictions will implement a minimum wage of $20.25 per hour, beginning in West Hollywood. Meanwhile, eight jurisdictions in Washington State will raise their minimum wage, including Tukwila, which will record the highest local minimum wage in the United States at $21.65 per hour.
States Moving Ahead on Wage Increases
The states scheduled to raise their minimum wage next year include Arizona, California, Colorado, Connecticut, Hawaii, Maine, Michigan, Minnesota, Missouri, Montana, Nebraska, New Jersey, New York, Ohio, Rhode Island, South Dakota, Vermont, Virginia, and Washington.
In contrast, 20 states—primarily in the southern United States—will not be affected by these increases, as they either do not set a state-level minimum wage or rely exclusively on the federal minimum wage.
These developments highlight a widening divide between states that are raising wages to keep pace with the rising cost of living and those that continue to depend on a federal minimum wage frozen for more than 15 years.