As states and cities increase minimum wage rates, some experts say a higher federal rate is long overdue.

A restaurant worker at a “wage strike” demonstration organized by One Fair Wage on May 26, 2021 in Washington, DC

Anna Moneymaker | Getty Images News | Getty Images

Minimum wage workers are getting a boost in income in some parts of the US, thanks to new higher minimum wage rates that went into effect in July.

Connecticut, Nevada, Oregon and Washington, D.C., all had new higher minimum wages as of July 1. Those increases come in the form of the federal minimum wage of $7.25 per hour, unchanged since 2009.

President Joe Biden has advocated raising the federal minimum wage to $15 an hour for all workers. In January, he signed an executive order that raised the minimum wage for federal workers and contractors to $15 an hour.

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But efforts to raise the federal pay rate more widely were deemed ineligible to be included in the budget resolution law Last year.

“Right now, it seems to have stalled somewhat,” said Pamela Loprest, senior fellow in the Center for Income and Benefits Policy at the Urban Institute, of efforts to raise the federal minimum wage.

Meanwhile, some states and territories have taken up the issue. Florida And Delaware Going to the minimum wage of $15 an hour. Companies such as Amazon, Target and Walmart have also moved to establish higher minimum wage rates for employees.

Here’s Where the Minimum Wage Is Rising

Connecticut:

  • Minimum wage increased from $13 to $14 per hour. It is set to increase again to $15 an hour from next June.

Nevada:

  • Employees without health benefits: The minimum wage is now $10.50 an hour, up from $9.75, and will gradually increase to $12 an hour in 2024.
  • Health Benefits Employees: The minimum wage is $9.50, up from $8.75, and will gradually increase to $11 in 2024.

Oregon:

  • The standard minimum wage goes up to $13.50 per hour, which is up from $12.75.
  • The Portland metropolitan rate increases from $14 to $14.75 per hour.
  • The minimum wage for non-urban counties is now $12.50 an hour, up from $12.

Washington DC:

  • The minimum wage is now $16.10 per hour, up from $15.20.

“It feels like an option in the stalemate of federal changes,” Loprest said. “It’s definitely the next best way to make a difference.”

How higher wages can help businesses

While some argue that higher minimum wages can put a burden on small businesses, the opposite is actually the case, argues business CEO Holly Sklar for a fair minimum wage.

“If you have an employee in one business, they are customers of many other businesses,” Sklar said.

“It’s a really great way to stimulate consumer demand, for local businesses to put money in the pockets of local customers,” she said.

Persistent inflation may complicate wage growth

Chipotle Mexican Grill prices are up about 4%, to cover the cost of raising the chain’s minimum wage to $15 an hour. Pictured, Chipotle employees in Houston.

Brandon Bell | Getty Images News | Getty Images

Higher inflation is believed to have made it more difficult to deliver wage increases, and also challenged businesses to find ways to cut external costs to avoid rising prices, Saginaw said.

Some economists have expressed concern that a higher federal minimum wage could fuel inflation, an idea Biden has rejected Between calls for the $15 per hour minimum wage.

Furthermore, according to David Cooper, director of the Economic Analysis and Research Network at the Economic Policy Institute, a higher minimum wage is unlikely to worsen inflation because low-wage jobs are not concentrated in industries that are fueling rising prices.

The federal minimum wage has lost about 26% of its value since it was last changed in 2009, and about 40% since 1968, he said.

While state and city efforts to raise minimum wage rates help, there are still about 20 states that base their minimum wages on federal rates.

“It would be much better if we raised the federal minimum wage,” Cooper said, and a lot is already being done in these states and cities, building in automatic adjustments to inflation or changes in wages.