The debate over whether or not the federal minimum wage should be increased continues. However, what some people may not know is that each state can set their own minimum wage. The only catch? It can’t be lower than the federally mandated wage. Here are the states with the highest minimum wage in the country.
The federally mandated minimum wage is set at $7.25 an hour. While many believe this rate is too low, keep in mind that it is meant to be a minimum wage. While a few states adhere to the federally mandated level, there is nothing to stop a state from setting its own, higher wage.
Because cost of living varies so widely, the federal minimum wage has remained relatively low. However, most states have instituted their own minimum wage requirements. Here are the states with the highest minimum wage as of 2018.
- Washington D.C – $12.50/hr
- Washington – $11.50/hr
- California (Tie) – $11.00/hr
- Massachusetts (Ties) – $11.00/hr
- Arizona (Tie) – $10.50/hr
- Vermont (Tie) – $10.50/hr
- New York – $10.40/hr
- Colorado – $10.20/hr
- Connecticut (Tie) – $10.10/hr
- Hawaii (Tie) – $10.10/hr
As you can see, most of the states with the highest minimum wage levels are relatively high cost of living states. New York, Connecticut, Hawaii, etc are all known to be expensive places to live.
Of course, if we’re talking about states with the highest minimum wage, there are also states that trend in the other direction.
States with the Lowest Minimum Wage
Several states maintain the federally mandated minimum wage. A few states do not have a state-mandated minimum wage and so they adhere to the federal rate.
No State Minimum Wage ($7.25/hour Federal Rate Applies)
- South Carolina
States With Minimum Wage Equal To Federal Level ($7.25)
- North Dakota
- North Carolina
- New Hampshire
Of the states above which all have a minimum wage of $7.25, additional rules may apply. in Georgia, for example, the $7.25 federal minimum wage rate applies because the state minimum wage rate is lower at $5.15 for employers with six or more employees and annual sales of more than $40,000.
Nevada adheres to the federal minimum wage only if the employee receives health benefits from their employer. If not, the minimum wage is $8.25.
Cost of Living Varies Based on Location
There are few cities where one can realistically live on minimum wage. Among them, St. Louis, Columbus, and Las Vegas. What you won’t tend to see make that list are cities that have higher minimum wages.
Why? Because the higher wages reflect a higher cost of living in that state. Washington, D.C. may have the highest minimum wage at $12.50 an hour, however the cost of living in D.C. is extremely high.
Assuming a 40/hour work week and no overtime, a D.C. resident earning minimum wage in the “state with the highest minimum wage” in the country would earn approximately: $26,000 per year.
Of course, these are average numbers and clearly there are residents of D.C. who DO earn minimum wage and manage. However, it does go to show that location matters and that’s where City vs City can help.
What is City vs City?
City vs City is a cost of living tool that allows you to compare the cost of living in your city with another city of your choosing. Input your data and select your cities. As a result, the app shows you how your costs will stack up against one another.
Your after-tax income is one key factor to input. The app also accounts for housing and transportation expenses, state and local taxes, and more.
Check out the demo below.
Your location matters. Even living in a state with the highest minimum wage may not be the best situation for you. Download City vs City and see how your cost of living might change if you moved elsewhere.