Minnesota's minimum wage to go up 21 cents on Jan. 1

The rates are being adjusted for inflation.
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Minnesota's 219,000 state minimum wage workers will get a pay rise on Jan. 1 when the rate goes up with inflation.

The Minnesota Department of Revenue announced on Thursday morning that the minimum wage for large employers will increase by 21 cents, from the $9.65 it is currently to $9.86, next year.

Meanwhile, small employers will have to pay 17 cents more an hour, as it rises from $7.87 to $8.04.

For full-time minimum wage employees working 40 hours a week, the change in the large employers rate will see them earn an extra $436.80 a year gross.

Someone working for a small employer – defined as a company whose revenues are less than $500,000 – will see their gross pay rise $353.60.

It's a bigger raise in the minimum wage than last year, when it increased 15 cents for large employers and 12 cents for small employers.

The new rates will apply for everywhere except in Minneapolis, which has enacted a higher minimum wage rate.

As of July 1 this year, large employers in Minneapolis must pay a minimum of $11.25, with small employers paying $10.25. This will rise to $12.25 and $11 respectively next July as the city moves gradually towards a $15 minimum wage.

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Speaking of the rising state minimum wage, Minnesota Labor and Industry Commissioner Ken Peterson said the increase is "great news" for the state's lowest earners, but "more needs to be done so all Minnesotans can earn their way to economic security."

Under the changing rates, the training wage to be paid to employees younger than 20 for the first 90 days of employment will be $8.04, as will be the youth wage rate paid to those under 18.

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