Minimum wage increases go into effect in three states, major cities

Minimum wage increases go into effect in three states, major cities
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Higher minimum wages will go into effect for workers in Illinois, Nevada and Oregon, as well as a handful of major cities, starting July 1.

In Illinois, the hourly minimum will increase from $9.25 to $10 an hour. In Nevada, where workers who don't receive health benefits have an extra dollar added to their hourly minimum, the lowest wage will also rise by 75 cents an hour to $8 for workers with benefits and $9 for those without.

Oregon's minimum will rise the same amount, from $11.25 to $12, though the increase is higher in the metropolitan Portland area, and lower for rural counties.

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Several major cities will also put in place higher minimum wages, including Washington, D.C., ($15), Chicago ($14), San Francisco, ($16.07), Los Angeles ($14.25 or $15, depending on employer size), Minneapolis ($11.75 or $13.25, depending on employer size), and St. Paul ($9 to $12.50 depending on employer size).

A slew of smaller cities in California are also slated for an increase.

“The July 1 raises are welcome increases for the economy, because more money in the pockets of workers means more consumer spending at local businesses," said Holly Sklar, CEO of Business for a Fair Minimum Wage.

Opponents of minimum wage increases say that the higher labor costs may help people with jobs, but say it will lead to higher unemployment.

Research on the topic has been mixed, but gradual increases by and large have not been associated with major employment effects.

But the increases come at an economically precarious time, with the nation facing extraordinary levels of unemployment due to the COVID-19 pandemic, businesses struggling, and laid-off workers having access to a vastly expanded unemployment insurance.

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Republicans have noted that the large unemployment checks passed by Congress create perverse incentives, meaning some people would make less money by returning to work. The problem could be less severe in places with higher minimum wages.

Democrats have made minimum wage increases central to their platform. The House last year passed a bill to gradually increase the federal minimum wage to $15.

The last federal minimum wage increase took place 11 years ago.

Updated at 4:06 p.m.