Make minimum wage? You're in line to get a raise today

Publish date:
Updated on

Thousands of people in Minnesota could be in line for a raise today.

The state's minimum wage jumps 50 cents on Aug. 1 – from $9 an hour, to $9.50 an hour for big employers. It's the third straight year the minimum wage has gone up, after state lawmakers approved an increase back in 2014. That's right, get ready to make it rain and then still keep track of where it all went, because bills.

What are the new rates?

Here's the breakdown:

Any company that's considered "large" – meaning it makes more than $500,000 a year – has to pay workers $9.50 an hour.

"Small" employers (so under $500,000) can pay $7.75 an hour.

There's also a training wage of $7.75 an hour that can be paid for 90 days to employees under 20. And people under 18 years of age can also be paid $7.75 an hour.

And that could go up again soon. From 2018 on, the minimum wage is supposed to be tied to inflation (a term that's referred to as "indexing").

Who gets paid minimum wage?

About 216,000 workers in Minnesota earned the effective minimum wage of $9 an hour or less last year.

That's from the Minnesota Department of Labor and Industry, which released a report in February looking at the makeup of the state's 1.58 million hourly earners.

Some of the findings:

Eating and drinking establishments

About 128,000 workers in the eating/drinking industry were paid hourly – and more than half earned minimum wage or less, the highest percentage of any industry. They were also unsurprisingly the most likely to get overtime, tips or commission.

Younger people more likely to get the minimum

Of everyone making the minimum wage or less, 55 percent were 15-24 years old.

Looking only at teenagers, more than half of the people ages 15-19 that were being paid hourly made $9 an hour or less. Of 25- to 54-year-old workers, 8.1 percent made that much.

Women earned less, more often

Take all the female hourly workers in the state – an estimated 15.6 percent earned minimum wage or less. On the male side, 11.4 percent took home that much.

That report doesn't mention race, but a few years ago the Council on Black Minnesotans estimated nearly 3 out of every 10 households of African descent in Minnesota would get a boost from a minimum wage increase.

A report from the Bureau of Labor Statistics last year found that, in 2014, about 3 million workers were making at or below the federal minimum wage of $7.25 an hour. That made up about 3.9 percent of the 77 million hourly paid workers in the U.S.

Next Up