California's minimum wage is set to increase to $17.40 per hour starting January 1, 2027, Governor Gavin Newsom announced Friday. This automatic adjustment, dictated by state law to keep pace with inflation, will place California's minimum wage significantly above the federal rate of $7.25 per hour and higher than any other current statewide minimum wage in the nation.
Newsom contrasted California's policy with federal inaction on minimum wage increases, stating, "For years, Donald Trump and Republicans have blocked efforts to raise the federal minimum wage while handing tax breaks to billionaires and big corporations." He added, "California has chosen a different path — one that rewards work, grows the economy, and puts working families first. We believe if you work hard, you deserve a decent paycheck. They think $7.25 an hour is enough. We don't."
This upcoming wage hike follows previous increases, including a significant rise for many healthcare workers on July 1, which pushed their minimum wages to between $19.28 and $25 per hour, depending on the type of facility. Governor Newsom has previously supported measures to increase wages, such as the $20 per hour minimum wage for fast-food workers, a policy that has drawn criticism regarding its economic impact on some businesses.
Rebekah Paxton, research director at the Employment Policies Institute, voiced concerns about the cumulative effect of such mandates, stating, "Governor Newsom wants a badge of honor for announcing the highest statewide wage mandate in the country. But his track record of wage hikes–including the $20 fast food wage–put workers dead last, with tens of thousands of lost jobs, shuttered businesses and higher prices for Californians."