The States With the Highest Minimum Wage Increase in 2023

7. (tie) Connecticut: $1.00

In July 2022, Connecticut’s minimum wage increased from $13 to $14. This is on par with the other $1 raises scheduled every 11 months since 2019 as part of Gov. Ned Lamont’s labor legislation. According to this plan, the minimum wage will max out at $15 in June 2023.

While the legislation makes room for minimum wage workers to earn more per hour, critics of the bill cite Connecticut’s high startup and operation costs for small businesses as potentially causing the wage increase to result in layoffs.

According to Connecticut’s largest business organization, the CBIA, small businesses still in recovery mode from the recession may need to turn toward labor-saving automation to save their bottom lines in the face of an increased wage. More studies are warranted on how this could affect the jobs of those who work for these businesses.

7. (tie) Florida: $1.00

A bill passed by Florida voters in 2020 started a gradual yearly increase of the state’s minimum wage from $8.65 in 2021 all the way to $15 in 2026. The wage increase is on schedule at $11, with the next increase to $12 set for Sept. 30, 2023.

Note that for tipped employees, the minimum wage is still $6.98, though it will also increase by a dollar each year. The lower wage, in this and other states, factors in the state-established tip credit, which in Florida is $3.02 per hour. Minimum wage notices are required in all businesses where relevant employees work.

Florida is also one of several states that won’t tax your retirement income.

7. (tie) Illinois: $1.00

The current minimum wage in Illinois is $13. It is scheduled to increase by $1 per year until Jan. 1, 2025, when it will reach $15. This is for workers ages 18 and older, as well as workers younger than 18 who work over 650 hours per year.

This legislation continues from the 2008 increase when the Illinois minimum wage was raised from $7.75 to its current minimum of $13. As with many states, the tipped wage differs based on the state’s tip credit, which in this case results in an hourly minimum of $7.80.

7. (tie) New York: ($1.00)

The Minimum Wage Act in New York required employees to receive a minimum wage of $14.20 by the end of 2022. This is only for the nonspecified industries, however, as the law makes provisions itemizing different lines of work for a higher wage of $15 per hour, including fast-food workers and anyone working in Long Island or Westchester County.

Since tipped workers receive a $5 tip credit in New York, their minimum wage is $10. These wages are up $1 per hour from last year and have currently reached the maximum provided by the state’s bill.

7. (tie) Virginia: $1.00

Starting Jan. 1, 2023, Virginia increased its minimum wage from $11 to $12. This is part of a planned schedule of increases signed into law by Gov. Ralph Northam, which will increase the wage up to $15 per hour by January 2026.

In addition to these increases, the law mandates a joint review of the feasibility of maintaining these wages by several agencies, including the Virginia Employment Commission. We’ll know their findings by the end of 2023.

5. (tie) Maine: $1.05

On Jan. 1, 2023, Maine’s minimum wage increased $1.05 to reach $13.80. This is part of ongoing changes mandated by the 2016 citizen’s referendum, which has been increasing the wage based on increases in cost-of-living expenses in Maine and other Northeast states.

The new wage for tipped employees in 2023 has risen to $6.90. Additionally, employers are required to show that this wage (plus tips) equals at least the state-mandated minimum. The law also states that the wage increase should continue indefinitely each Jan. 1 to keep up with cost-of-living increases for employers with 50 or more employees.

5. (tie) Arizona: $1.05

On Jan. 1, 2023, Arizona’s minimum wage increased by $1.05, taking it from $12.80 to $13.85. This is based on the Consumer Price Index (CPI) released by the U.S. Bureau of Labor Statistics for 2021-2022. The tipped wage has also increased, to $10.85.

Those working in Flagstaff also have a unique minimum wage based on the regional CPI: $16.80, and $14.80 for tipped earners. As in most states, certain jobs and age groups have unique minimum wages, including vocational students, disabled employees, and minors. Check the state’s minimum wage exemptions to learn more.

4. Colorado: $1.09

Colorado’s minimum wage increased by $1.09 at the start of 2023, reaching $13.65. The tipped wage is $10.63. This follows Colorado’s yearly wage increases dating back to 2011, when the wage went up $0.12, from $7.24 to $7.36.

So long as an employee is covered by Colorado’s state-mandated minimum wage laws, they have to be paid the new amount. Since Colorado has increased the minimum wage every year for the last 16 years, seniors looking ahead may want to consider this trend as an opportunity for growth.

Note also that in Denver, due to the high cost of living, the minimum wage has increased to $17.29 for 2023.

3. New Jersey: $1.13

On Jan. 1, 2023, New Jersey instituted a new minimum wage of $14.13, up $1.13 from 2022. Gov. Phil Murphy’s legislation was first signed into law in 2019 as a part of a plan to increase the minimum wage above $15 by 2024.

The law also makes provisions for after 2024, stating that increases in the minimum wage will continue proportionally with increases in the state’s cost of living. The wage of tipped workers has increased to $5.26 with an $8.87 tip credit. There are some exemptions to the new minimum wage laws as well, with some industries staggering the increases for long periods. Agriculture workers, for instance, will not reach $15 per hour until 2027.

1. (tie) Washington: $1.25

Washington state’s voters approved Initiative 1433 in 2016, requiring a state-mandated minimum wage increase of $0.50 or more every year, which now puts it at $15.74 after a $1.25 increase last year.

In 2021, the minimum wage legislation was extended to agricultural workers, who in most states are the last to receive these benefits. Additionally, in businesses with 50 or fewer employees, overtime-exempt workers should be earning 1.75 times the minimum wage. This increases to 2 times for businesses with over 50 workers.

1. (tie) Delaware: $1.25

Delaware is tied with Washington state for the highest minimum wage increase in the country from 2022 to 2023. This brings the wage in Delaware up to $11.75 in 2023, with a $1.50 increase planned for 2024 and a $1.75 increase for 2025. The tipped wage in Delaware is only $2.23.

Note that minimum wage-exempt employees in Delaware include those in agriculture, domestic services, government work, salespeople that work on commission, and volunteer workers. If you plan on working in Delaware or elsewhere, look into the state’s regulations on which industries are exempt from state-regulated minimum wage increases.

Bottom Line

For many seniors, especially those who are delaying collecting their Social Security benefits to let their nest eggs grow, a minimum wage change can make an important impact on their quality of life.

There’s more to calculating wage potential by the state than just the minimum wage increase, however. Use this list to dig deeper into your potential place of employment, as wage exemptions, law changes, and cost-of-living increases should also impact your decision on where to live (and work) in the coming years.

If you’re planning to retire soon, be sure to check out our helpful guides:

• Tax Preparation Tips for Retirees
• Retirable Review
• How to Recover Lost Money
• How Much Money Do You Need to Retire?