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The minimum wage in New Jersey will increase more than previously expected next year, going up to $14.13 per hour for most workers, the state Labor Department announced this week.
The current statewide minimum wage was scheduled to rise from $13 to $14 on Jan. 1, 2023 under a state law Gov. Phil Murphy signed in 2019 that gradually increases the wage to $15 an hour by 2024.
But the law allows for a larger bump if there’s a significant increase in the Consumer Price Index, the most widely used measure of inflation in the U.S. An increase in the CPI this year triggered the extra 13 cents per hour, officials said.
The CPI started to rise in 2021 amid a rapid economic recovery following widespread shutdowns during the pandemic. By June of this year, the annual rate of inflation in the U.S. had risen to a new 40-year high of 9.1%, a bump of nearly eight points in less than 18 months.
This is the first time the provision has kicked in since Murphy signed the law. The minimum wage increased from $8.60 to $10 the first year after the law was signed and has increased by $1 in each of the last three years.
“The Governor and Legislature had the forethought to account for the possibility of rising costs in their historic minimum wage law, which helps low-wage workers better provide for themselves and their families,” Labor Commissioner Robert Asaro-Angelo said in a statement. “Every extra dollar in the paychecks of our lowest wage workers is helpful.”
Once the minimum wage reaches $15 in the state, it will continue to be adjusted on an annual basis based on the CPI, officials said.
The state also announced the following changes for other workers:
- The minimum wage for seasonal and small business employees will increase from $11.90 to $12.93 per hour. Those businesses were given until 2026 to pay their workers $15 an hour.
- The wage for hourly or piece-rate agricultural and farm employees will increase from $11.05 to $12.01 per hour. Those employers were given until 2027 to reach $15 an hour.
- The wage for direct staff at long-term care facilities will increase from $16.00 to $17.13 per hour.
- The cash wage for tipped workers will increase to $5.26 per hour. The minimum cash wage plus an employee’s tips must equal at least the state’s minimum wage.
NJ Advance Media staff writer Derek Hall contributed to this report.
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