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California's New Minimum Wage Well Outside Historical Experience

Created on May 19, 2016

California's New Minimum Wage Well Outside Historical Experience

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Read the original report, "California’s Unprecedented Minimum Wage Increase Will Hurt Vulnerable Workers," by James Sherk.

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In January 2016, California’s minimum wage was increased to $10 per hour, the highest in the U.S. The wage will increase another 34 percent over the next seven years after adjusting for inflation.

NOTE: Minimum wages are adjusted for inflation to 2016 dollars using the PCE deflator. Wages for 2016–2023 are adjusted for inflation by assuming nominal wages in California grow at the average annual rate that median wages did in California in 2005–2015, approximately 1.6 percentage points a year.
SOURCE: Heritage Foundation analysis of historical minimum wage rates by state; National Bureau of Economic Research, “CPS Merged Outgoing Rotation Groups,” http://www.nber.org/data/morg.html (accessed May 13, 2016); and California's new minimum wage schedule.

CHART 1 • IB 4563

Tags: California, minimum-wage