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Minimum wage increases will be going into effect around the country in 2015–but not in Maine

In 2015, according to the National Conference of State Legislatures, the minimum wage in 24 states will increase. The federal minimum wage is currently $7.25 per hour.  In 2015, 29 states will require employers to pay more than the federal minimum wage.  Maine is one of these 29 states with a minimum wage of $7.50 per hour.

In 2014, four states approved increases to their minimum wages through ballot measures and legislatures in eleven states, as well as the District of Columbia, also approved minimum wage increases.  Another nine states have minimum wage laws that call for automatic increases to the minimum wage in 2015 based on measures of inflation.

Four of the 24 states that will see increases to their minimum wages in 2015 are Connecticut, Massachusetts, Rhode Island, and Vermont.  Their minimum wages will be: $9.15 per hour in Connecticut; $9.00 per hour in Massachusetts; $9.00 per hour in Rhode Island; and $9.15 per hour in Vermont.

Maine last raised its minimum wage in 2009, which is also the last time the federal minimum wage was raised.  Even though the federal minimum wage has increased over the years, if you take inflation into account, the federal minimum wage is actually lower now than it was in the past.  According to the U.S. Department of Labor, when you take inflation into account, to equal the minimum wage from the early 1980’s, the federal minimum wage would need to be more than $8.00 per hour; and to equal the minimum wage from the late 1960’s, it would need to be nearly $11.00 per hour.

To ensure that the minimum wage does not erode over time, it makes sense to at least index the minimum wage to inflation.   That way, when prices for groceries, housing, transportation and other essentials increase, the minimum wage would automatically increase as well so that the real income of low wage workers does not decrease.  Vermont began to follow this approach in 2007.  In Vermont, beginning January 1, 2019, the minimum wage will increase annually by 5% or according to the Consumer Price Index (CPI), whichever is smaller; it cannot decrease.