State Minimum Wage Updates for 2025: What Employers Need to Know
As 2025 approaches, employers must prepare for adjustments in state minimum wage requirements. A total of 21 states will see increases, reflecting changes in cost-of-living adjustments and new legislation. Whether your business operates in a single state or multiple, understanding these shifts is critical for compliance and fair employee compensation.
Here’s a detailed guide to help your business stay informed and compliant with 2025 minimum wage updates.
Minimum wages, set by both federal and state governments, aim to ensure employees receive fair pay. While the federal minimum wage remains at $7.25 per hour, many states have higher requirements. Employers must adhere to the rate most favorable to employees.
However, most states surpass the federal rate, with specific updates for 2025 noted below.
This list doesn’t consider every city or municipality with its own minimum wage requirement. Understand these hourly minimum wage rates for any of the states where your business operates:
| State | 2025 Minimum Hourly Wage | 2024 Minimum Hourly Wage |
| Alabama | $7.25 | $7.25 |
| Alaska | $11.91* | $11.73 |
| Arizona | $14.70* | $14.35 |
| Arkansas | $11.00 | $11.00 |
| California | $16.50 | $16.00 |
| Colorado | $14.81* | $14.42 |
| Connecticut | $16.35* | $15.69 |
| Delaware | $15.00 | $13.25 |
| Florida | $13.00* | $13.00 |
| Georgia | $7.25 | $7.25 |
| Hawaii | $14.00 | $14.00 |
| Idaho | $7.25 | $7.25 |
| Illinois | $15.00 | $14.00 |
| Indiana | $7.25 | $7.25 |
| Iowa | $7.25 | $7.25 |
| Kansas | $7.25 | $7.25 |
| Kentucky | $7.25 | $7.25 |
| Louisiana | $7.25 | $7.25 |
| Maine | $14.65* | $14.15 |
| Maryland | $15.00 | $15.00 |
| Massachusetts | $15.00 | $15.00 |
| Michigan | $10.56† | $10.33 |
| Minnesota | $11.13* | $8.85 for small employers and $10.85 for large employers.‡ |
| Mississippi | $7.25 | $7.25 |
| Missouri | $13.75* | $12.30 |
| Montana | $10.55@ | $10.30 |
| Nebraska | $13.50* | $12.00 |
| Nevada | $12.00* | $12.00 |
| New Hampshire | $7.25 | $7.25 |
| New Jersey | $15.49 for most employers; $14.53 for seasonal and small employers who have less than six workers.* | $15.13 for most employers; $13.73 for seasonal and small employers who have less than six workers. |
| New Mexico | $12.00 | $12.00 |
| New York | $16.50 for New York City, Long Island and Westchester County; $15.50 for the rest of the state.* | $16.00 for New York City, Long Island and Westchester; $15.00 for the rest of the state. |
| North Carolina | $7.25 | $7.25 |
| North Dakota | $7.25 | $7.25 |
| Ohio | $10.70 for employers with annual gross receipts of $394,000 or more. $10.70 per hour for nontipped employees and $5.35 per hour for tipped employees.* | $10.45 for employers with annual gross receipts of $385,000 or more. Minimum wage of $7.50 for employers with annual gross receipts under $385,000. |
| Oklahoma | $7.25 | $7.25 |
| Oregon | Basic minimum wage is $14.70, $15.95 for Portland Metro Area and $13.70 for non-urban counties.* | Basic minimum wage is $14.70, $15.95 for Portland Metro Area and $13.70 for non-urban counties. |
| Pennsylvania | $7.25 | $7.25 |
| Rhode Island | $15.00 | $14.00 |
| South Carolina | $7.25 | $7.25 |
| South Dakota | $11.50* | $11.20 |
| Tennessee | $7.25 | $7.25 |
| Texas | $7.25 | $7.25 |
| Utah | $7.25 | $7.25 |
| Vermont | $14.01* | $13.67 |
| Virginia | $12.41* | $12.00 |
| Washington, D.C. | $17.50* | $17.50 |
| Washington | $16.66* | $16.28 |
| West Virginia | $8.75 | $8.75 |
| Wisconsin | $7.25 | $7.25 |
| Wyoming | $7.25 | $7.25 |
* Minimum wage is adjusted annually based on the Consumer Price Index.
† Michigan’s minimum wage will increase to $12.48 effective Feb. 21, 2025.
‡ Minnesota defines “large employers” as businesses with $500K or more in gross revenue.
# A business not covered by the federal Fair Labor Standards Act whose gross annual sales are $110,000 or less may pay $4 per hour. However, if an individual employee is producing or moving goods between states or otherwise covered by the federal Fair Labor Standards Act, that employee must be paid the greater of either the federal minimum wage or Montana’s minimum wage.
In 2025, 21 states are increasing their minimum wages. States that adjust rates based on the Consumer Price Index (CPI) often lead these updates. Here’s a breakdown:
| State | 2025 Minimum Hourly Wage | 2024 Minimum Hourly Wage |
|---|---|---|
| Alaska | $11.91* | $11.73 |
| California | $16.50 | $16.00 |
| Colorado | $14.81* | $14.42 |
| Connecticut | $16.35* | $15.69 |
| Illinois | $15.00 | $14.00 |
| Missouri | $13.75* | $12.30 |
| Ohio | $10.70* | $10.45 |
| Washington | $16.66* | $16.28 |
(*Indicates CPI-based adjustments.)
The minimum base wage for tipped employees often differs from non-tipped rates. For example:
Employers must ensure tipped employees receive total pay (base wage plus tips) meeting the applicable state minimum wage.
In Ohio, businesses with gross receipts under $394,000 may pay the federal minimum wage of $7.25. However, discrepancies in interpretations of this threshold exist. If your business grosses exactly $394,000, consult state authorities for clarification.
This guide focuses on state-level minimum wages and excludes local variations, such as cities with higher minimum wage ordinances. Be sure to verify wage rates in all applicable jurisdictions.
Under Executive Order 14026, the federal contractor minimum wage will increase to $17.75 per hour on January 1, 2025.
California mandates a $20 per hour minimum wage for fast-food workers in businesses with 60 or more establishments nationwide.
Remaining compliant with changing wage laws protects your business from penalties and fosters a positive work environment. Here are actionable steps to ensure compliance:
CTR Payroll | HR simplifies compliance with wage regulations, offering tailored payroll solutions and compliance support. Our experts can help your business:
Contact us today to learn how CTR Payroll | HR can support your business in staying compliant and competitive.
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DISCLAIMER: The information provided herein does not constitute the provision of legal advice, tax advice, accounting services or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional legal, tax, accounting or other professional advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation and for your particular state(s) of operation.
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