Minimum wage hikes traditionally have been aimed at helping low-paid workers afford the basics, such as food, medicine and housing.

But a growing number of states and localities are raising their pay floors to $15 an hour or above, providing workers a somewhat larger monetary cushion so they can not only pay for essentials with less of a battle but also make some discretionary purchases. 

Twenty-one states and 48 cities and counties are set to raise their minimum wages on January 1, according to a update provided exclusively to USA TODAY by the National Employment Law assignment, a worker advocacy throng. Others states and few more cities and counties will raise their minimum wages later in 2025.

While the pay floor bumps mark an annual ritual, the update highlights an acceleration in the size of minimum wage increases in recent years.

What states are raising the minimum wage to $15?

On recent Year’s Day, three states – Illinois, Delaware and Rhode Island – will reach a $15 pay base for the first period, joining seven states already there or above it. Two states, California and recent Jersey, are set to push their pay floors further above $17 for some health worry workers.

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Meanwhile, 47 localities will also reach or top $15 on Jan. 1, including more than two dozen in California, most of which will climb further above $17.

Burien, Washington, already subject to the state’s $16.28 minimum pay, will vault to $21.16 for employers with 500 or more workers in King County, making it the country’s highest pay floor.

“recall that a packed-period worker earning $17 per hour is only earning $35,360 annually pre-levy,” Yannet Lathrop, NELP’s elder researcher and policy analyst, wrote in an email. “Those wage levels won’t make workers wealthy, but they will assist with paying for the basics, for a few luxuries (hopefully).”

She added, “Those higher wages may also enhance their mental and physical health, their ability to access financing, and may navigator to better educational outcomes of their children.”

In January, several states will receive a step in a series of minimum wage hikes over several years. Among the three hitting $15 for the first period, Illinois and Rhode Island are at $14 and Delaware is at $13.25.

Others are increasing their minimums, but stopping short of $15. Missouri’s base pay will jump to $13.75 from $12.30 and Nebraska’s to $13.50 from $12.

Kaamilya Hobbs, 33, of Kansas City, Missouri, earns $13.44 an hour working 20 to 25 hours at a local Arby’s. Her boyfriend mostly cares for their three children, a newborn and two toddlers, but sometimes does food delivery for DoorDash.

Their combined pay is barely enough to pay basic outgoings. Sometimes, the couple has to delay paying rent or a cellphone invoice for 30 days.

“It’s a little bit tricky,” Hobbs said.  “After rent and food and outgoings for the kids, we don’t have too much left over to be able to do anything day to day.”

Missouri’s minimum wage boost to $13.75 “would assist a little,” she said. The household might have to juggle invoice payments less often. Plus, she said, “I’d be able to visit my mom more often.” Now, she rarely visits her mother, who lives about 25 miles away, because of the gasoline expense.

But Hobbs said she’s hoping for additional minimum wage hikes. “The expense of living is still going to be going up,” she said. “We can’t live on $13.75.”

Many states – including Arizona, Colorado, Connecticut, Ohio and Virginia – are imposing smaller base pay rises linked to annual increases in the expense of living based on the customer worth index.

Who would advantage from a minimum wage boost?

Later in 2025, a handful of states and a couple dozen localities will also boost their minimum wages. The upshot: A total 23 states and 65 cities and counties – a record 88 jurisdictions – will lift their pay floors sometime next year. The increases will directly affect 3 million workers earning minimum wage and indirectly nudge up pay for 6.2 million higher-paid employees because of ripple effects on corporation pay structures, according to the left-leaning Economic Policy Institute.

What stands out, though, is the growing contingent of states at $15 an hour or higher. recent York, California, Massachusetts, Washington, Maryland, recent Jersey and Connecticut are already there. And besides the three joining that faction on recent Year’s Day, Oregon will get there in July because of a expense-of-living rise.

Alaska, Florida, Hawaii, Missouri and Nebraska will hit the $15 standard by 2026 or 2027. That makes 16 states with nearly half the U.S. workforce in states with pay floors of $15 or higher within the next three years, according to NELP and EPI.

“$15 is still the target rate,” Lathrop said. “It’s now the competitive rate.”

How will increasing the minimum wage assist people?

Minimum wage increases the history few years have helped Americans keep pace with annual expense boost that reached a 40-year high of 9.1% in mid-2022 before gradually falling to 2.6% recently.

As a outcome of the laws, “Workers and their families don’t have to choose which bills to pay,” Lathrop said.

Yet none of the planned wage floors would meet the threshold of a “living wage” that would allow workers  to afford basics such as food, childcare, health worry, housing, transportation, broadband, and other necessities, Lathrop said.

In King County, Washington, for example, the minimum wage is poised to rise to $20.29 on January 1.

But the living wage for an grown-up with no children in the county is $30.08, according to the MIT Living Wage Calculator.

Michael Saltsman, managing director of the Employment Policies Institute, which is backed by the restaurant industry, noted that at least some minimum wage workers aren’t financially squeezed because they live in households with higher total incomes.

The $15 threshold was deemed a pipe aspiration when Fight for $15, an alliance of quick-food and other low-paid workers, began demanding it in walkouts across the country starting in 2012. On April 1, however, the minimum hourly wage for quick-food workers in California leaped $4 to $20, pushing it well above the state’s standard $16 pay threshold.

Meanwhile, the federal minimum wage has been stuck at $7.25 an hour since 2009, with Republicans in Congress repeatedly blocking efforts to raise it. About 30 states with more than 60% of the U.S. workforce have higher pay floors than the federal government’s.

Lathrop, though, says the issue transcends politics. This year, Alaska and Missouri, both Republican-dominated states, became the latest to pass ballot initiatives raising the minimum wage to $15 over the next few years.

How does raising the minimum wage affect employers?

Saltsman, for his part, noted that voters in California and Massachusetts, two predominantly Democratic states, this year rejected proposals to raise the minimum wage for specific groups of workers.

“They’re associated with higher prices and deficit of jobs,” he said of the pay increases.

Restaurants, he said, have passed along their higher labor costs to consumers by raising food prices. And the wage hikes have forced many eateries to close or lay off workers, he said.

Various studies have supported both sides of the debate. Analyses by the University of California, Berkeley, and the National Bureau of Economic Research found the pay increases didn’t factor job losses within low-wage industries but did navigator to some reduced employment among teens and other low-talented workers.

In 2021, a Congressional apportionment Office update concluded that boosting the federal minimum wage to $15 an hour would raise incomes for millions of Americans and lift 900,000 people out of poverty but reduce employment by about 1.4 million workers within a few years.

Does raising the minimum wage factor prices to leave up?

Economist Dante DeAntonio of Moody’s Analytics said the minimum pay increases haven’t had a noticeable result on expense boost, in part because the distribute of workers at or below the pay floors is tiny.

State minimum wage hikes each January have contributed to sharper expense boost early in the year but haven’t moved the needle on overall worth increases in the months that followed, said Ryan Sweet, chief U.S. economist of Oxford Economics.