Minimum Wage Changes Across the U.S. in 2025: What Employers Need to Know

As of January 1, 2025, many U.S. states have implemented new minimum wage laws, impacting businesses and workers alike. These changes reflect ongoing efforts to address inflation and improve economic stability for employees. Whether you’re managing a small business or overseeing HR operations for a mid-sized company, staying informed about these changes is crucial for compliance and planning. 

Below is a comprehensive overview of the updates to minimum wage laws across the country:

Minimum Wage Changes by State

Alaska

• Increased to $11.91 per hour, with a scheduled rise to $13.00 per hour on July 1, 2025.

• Annual indexing starts January 1.

Arizona

• Rose to $14.70 per hour, with future adjustments tied to the Consumer Price Index (CPI).

California

• Statewide: Increased to $16.50 per hour.

• Local rates vary, e.g., San Francisco ($18.98) and Emeryville ($19.36).

Colorado

• Increased to $14.81 per hour.

• Tipped wage rose to $11.79 per hour, with adjustments based on inflation.

Connecticut

• Increased to $16.35 per hour.

• Tipped wages are now $6.38 for waitstaff and $8.23 for bartenders.

Delaware

• Rose to $15.00 per hour.

• Tipped minimum wage remains at $2.23.

Illinois

• Increased to $15.00 per hour, with tipped wages at $9.00.

Maine

• Increased to $14.65 per hour, with tipped wages rising to $7.33.

Michigan

• Initial increase to $10.56 per hour, with a further rise to $12.48 on February 21, 2025.

Minnesota

• Increased to $11.13 per hour for all companies.

• This change eliminates the previous two-tier system that differentiated between large and small employers.

Missouri

• Rose to $13.75 per hour, with tipped wages at $6.88.

Nebraska

• Increased to $13.50 per hour.

New Jersey

• Statewide: Rose to $15.00 per hour, with tipped wages at $5.26.

New Mexico

• Increased to $12.50 per hour, with tipped wages at $3.13.

New York

• Statewide: Adjusted to $15.00 per hour.

• In New York City, Long Island, and Westchester County, the minimum wage is $16.50 per hour.

Ohio

• Increased to $10.65 per hour, with tipped wages at $5.35.

Rhode Island

• Rose to $14.00 per hour.

South Dakota

• Increased to $11.50 per hour, with tipped wages at $5.75.

Vermont

• Rose to $14.01 per hour, with tipped wages at $7.01.

Virginia

• Increased to $12.41 per hour.

Washington

• Statewide: Rose to $16.68 per hour, maintaining the same rate for tipped workers.

• Some localities have higher rates; for example, Seattle's minimum wage is $20.76 per hour.

Please note that local jurisdictions may have different minimum wage rates that exceed state minimums. It's essential for employers to verify and comply with the specific wage laws applicable to their location and industry.

Why Staying Compliant with Minimum Wage Laws Matters

Staying compliant with state and local wage laws is more important than ever, as non-compliance can result in fines, lawsuits, and reputational damage. HR leaders must ensure their payroll systems and policies are up to date with the latest regulations.

Take the Hassle Out of Compliance with GoCo

Managing payroll and compliance doesn’t have to be stressful. With GoCo, you can automate updates, streamline processes, and ensure your business stays compliant with ease.