Millions of US Workers Set for 2027 Pay Hike as 16 States Lift Minimum Wages, but Others Stay at $7.25

Millions of American workers in at least 16 states are set for minimum wage increases at the start of 2027, even as the federal pay floor remains stuck at $7.25 (about £5.42) an hour for the 18th consecutive year.

Michigan is leading the way with the largest confirmed rise so far: a $1.27 (approximately £0.95) hourly jump to $15 (about £11.21) for most workers. Vermont is expected to follow with an inflation-linked increase, although its new rate has not yet been announced.

19 states raised their minimum wages in January 2026 through scheduled legislation or inflation-indexed adjustments. The coming changes will again leave workers on sharply different hourly rates depending on where they live and which wage rules cover their jobs.

Michigan Leads 2027 Minimum Wage Increases With $1.27 Rise

Michigan's general minimum wage will increase from $13.73 (about £10.26) to $15 (about £11.21) an hour, a rise of approximately 9.2 per cent. The change follows the state's published wage schedule.

An employee working 40 hours every week for 52 weeks at the old minimum would receive around $2,642 (about £1,974) more in annual gross pay. Actual gains will depend on working hours, eligibility and whether an employee already earns above the new minimum.

The rules are not identical for everyone. Michigan's minimum cash wage for tipped employees will be $6.30 (about £4.71) an hour. Employers must make up the difference when wages and tips combined fall short of the applicable minimum.

Rhode Island's general minimum will rise from $16 (about £11.95) to $17 (about £12.70). Under the same full-time calculation, that is an additional $2,080 (about £1,554) annually before deductions.

Virginia's hourly minimum will increase by 98 cents (about 73p) to $13.75 (about £10.27).

Washington's Minimum Wage Remains Highest Among States

Washington's statewide minimum will climb from $17.13 (about £12.80) to $17.73 (about £13.25). Its Department of Labor & Industries says the 60-cent increase reflects an inflation adjustment.

At 40 hours a week, the rise would add $24 (about £18) to gross weekly earnings for an eligible employee. Local wage rules may differ.

That will be the highest statewide minimum, although Washington, DC, and some cities have higher rates.

Connecticut's minimum will reach $17.48 (about £13.06), while California's will rise to $17.40 (about £13.00). Other states with scheduled January increases include New Jersey, Colorado, Maine, Minnesota, Ohio, South Dakota, Montana, Nebraska and Arizona.

Vermont also expects an inflation-linked increase on 1 January, but has not formally announced its new rate.

Alaska follows a different timetable. Its minimum will increase from $14 (about £10.46) to $15 (about £11.21) on 1 July 2027.

Federal Minimum Wage Freeze Leaves Workers on Different Rates

The federal minimum has remained at $7.25 since 24 July 2009. The US Department of Labor says covered, non-exempt employees must receive the higher applicable rate where federal and state laws overlap.

Workers in states including Texas, North Carolina, Tennessee and Pennsylvania remain subject to the federal floor, unless another applicable wage rule provides more.

Georgia's statutory minimum is lower, but federally covered, non-exempt workers generally must receive at least $7.25. Some tipped workers, younger employees and specific industries have separate provisions.

New York's general rates will stay at $17 (about £12.70) in New York City, Long Island and Westchester, and $16 (about £11.95) elsewhere. An inflation-adjustment safeguard prevented an increase for January.

Home care aides are an exception. Their minimum rates will rise to $20 (about £14.94) in the higher-rate areas and $19 (about £14.20) elsewhere in New York.

That leaves qualifying home care aides with a statutory hourly minimum $3 (about £2.24) above the general rate in either region, despite the wider freeze.