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Reality Check: Minnesota's New Minimum Wage

MINNEAPOLIS (WCCO) -- About 219,000 Minnesota workers are getting the pay hike.

The minimum wage for small businesses is now $8.01 an hour. And for large employers it goes up to $9.86 an hour.

Many workers think it is still too low. The full pay hike of 21-cents an hour adds up to about $436.80 a year. And even at the higher level, it's a yearly paycheck of about $20,800 -- barely at the poverty level.

Minnesota now has the highest minimum wage in the Upper Midwest.

Midwest Minimum Wage

  • Minnesota: $9.86
  • Wisconsin: $7.25
  • Iowa: $7.25
  • North Dakota: $7.25
  • South Dakota: $9.10
  • Minimum Wage Workers
    (credit: CBS)

    Despite predictions of major job losses with a higher minimum wage, that's not what happened. Minnesota's unemployment rate is at a near record low of 2.8 percent.

    And the number of workers at a record high: 3,000,000 Minnesota workers.

    Even so, lower-paid workers are barely keeping up. In 1970, Minnesota's minimum wage was $1.60. Adjusted for inflation, that's about $21,800 a year. That is $1,000 more than what workers earning the new minimum wage will take home now.

    Minnesota's full minimum wage now tops the federal minimum wage by more than 2.50 an hour. California, Massachusetts and Washington have the highest state minimum wages at $12 an hour.

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