🔒CT already near the top as Murphy pushes $25 federal minimum wage

When U.S. Sen. Chris Murphy unveiled legislation last month to raise the federal minimum wage to $25 an hour, he did so from a state that has already moved well beyond the national standard. Connecticut’s $16.94 hourly minimum wage is the second-highest statewide rate in the country, behind only Washington state’s $17.13. The District of Columbia’s minimum wage is also higher, at $18.40. Twenty states still use the federal minimum wage of $7.25 an hour, which has remained unchanged since 2009. State minimum wage laws have increasingly diverged over the past decade. While Connecticut and many other Northeastern and West Coast states have continued raising their wage floors, much of the South and Midwest still follows the federal rate. The Living Wage for All Act would raise the federal minimum wage to $12 an hour in its first year before gradually increasing it to $25. Under the bill, large employers would have until 2032 to reach the $25 minimum wage, while smaller employers would have until 2039. The bill would also eliminate subminimum wages for tipped workers, workers with disabilities and youth workers. Once the wage reaches $25, it would automatically increase each year to equal two-thirds of the national median wage. According to Murphy’s office, roughly 67 million workers — about 45% of the U.S. workforce — currently earn less than $25 an hour. “If you work full time in this country, you should be able to afford to live,” Murphy said when announcing the legislation. “Our economy is not working for people and we have to put forward solutions that are as big as the problems American families are facing.” Murphy, a Democrat, argues the federal minimum wage has failed to keep pace with inflation and worker productivity. According to materials released with the bill, the minimum wage would be roughly $25 an hour today if it had kept pace with productivity growth since the late 1960s. The legislation also cites research indicating that a parent with one child needs to earn more than $25 an hour to meet basic living expenses in every U.S. county.

Business pushback

Connecticut has taken a different approach than Congress. Rather than requiring lawmakers to periodically approve increases, the state automatically adjusts its minimum wage each Jan. 1 based on the federal Employment Cost Index, a measure of wage growth. The indexing system took effect in 2024 after the state reached a $15 minimum wage under a series of scheduled increases approved in 2019. Chris DiPentima, president and CEO of the Connecticut Business & Industry Association, said the state’s median hourly wage is about $27, meaning many employers already pay well above the $16.94 minimum wage to attract and retain workers. Still, he said annual increases create financial pressure, particularly for small businesses, because employers often raise wages across their organizations to maintain pay differences between entry-level employees, experienced workers and managers. “While larger employers may have more ability to absorb higher labor costs, smaller businesses generally have fewer options,” DiPentima said. “And in industries like manufacturing, which operate in a global market, absorbing or passing those costs on to consumers can also be more difficult.” Murphy’s proposed $25 federal minimum wage would directly or indirectly affect roughly half of Connecticut’s workforce because it would sit just below the state’s median hourly wage, DiPentima noted. He argued that higher wages alone won’t solve Connecticut’s affordability challenges. Policymakers must also address the state’s high housing, healthcare, energy and childcare costs, which continue to strain both families and employers, DiPentima said.

Higher statewide rates

Nationally, wage floors continue to increase in many states and local governments. Twenty-six states and local jurisdictions increased minimum wages on July 1, according to the Employment Policies Institute. Alaska raised its statewide minimum wage to $14 an hour, while Florida is scheduled to increase its minimum wage to $15 an hour on Sept. 30. California also continues implementing industry-specific wage requirements for certain healthcare and hospitality workers that exceed the statewide minimum wage. Murphy’s proposal has drawn criticism from business-backed organizations. In a report issued after the legislation was introduced, the Employment Policies Institute said a $25 federal minimum wage could increase labor costs for employers, drive up consumer prices and reduce employment opportunities, particularly for teenagers and entry-level workers. The institute pointed to recent ballot results in Oklahoma, California and Massachusetts that rejected various minimum wage proposals, arguing those outcomes suggest voters remain concerned about the potential economic effects of large wage increases. Regardless of public sentiment, Murphy’s proposal faces significant political hurdles in Congress. The Washington Post reported the legislation is unlikely to advance in the current Congress, where Republicans control both chambers. Congress has not increased the federal minimum wage since 2007, when lawmakers approved a three-step increase that ultimately raised it to its current $7.25 an hour in 2009.