California Prepares for Minimum Wage Increase in 2024
As the new year approaches, California is gearing up for an increase in its minimum wage, solidifying itself as one of the states with a significantly higher base wage than the federal minimum of $7.25 per hour. Currently set at $15.50 per hour, the minimum wage will see a rise starting on January 1, 2024.
The increase will be calculated using a formula that takes into account 3.5% annually or the percentage of change between the data of the Consumer Price Index for urban employees and administrative workers (CPI-W), selecting the lower figure. This year, the comparative data showed an increase of 6.16% in the CPI-W for the period from July 2022 to June 2023 compared to the previous year. However, as 3.5% is the lower figure, the minimum wage for the next year will rise to $16 per hour.
In addition to the minimum wage increase, fast food workers will see a significant boost in their income as legislation signed into law by Governor Gavin Newsom will raise their minimum wage to $20 per hour beginning April 1, 2024. This provision will only apply to fast food restaurants with at least 60 locations nationwide, with the exception of those that make and sell their own bread, such as Panera Bread.
Furthermore, legislation has been approved to benefit over 400,000 health workers, excluding doctors and nurses. Starting June 1, 2024, salary increases will take effect staggered based on specific categories:
-Dialysis clinics and large health systems with over 10,000 workers: $23 per hour in 2024, $24 in 2025, and $25 in 2026.
-Hospitals with a high mix of Medi-Cal and Medicare patients, as well as independent rural hospitals: $18 per hour in 2024, increasing 3.5% annually to $25 in 2033.
-Community clinics: $21 per hour in 2024, increasing to $22 in 2026 and $25 in 2027.
-Other healthcare employees: $21 per hour in 2024, $23 in 2026, and $25 by 2028.
California is not alone in this wage adjustment, as 24 other states will also increase their minimum wage in 2024, with Nevada and Oregon in July, and Florida in September, following suit throughout the year.