(WJW) — Next year, Ohio’s minimum wage will jump from $9.30 per hour to $10.10 for non-tipped employees and from $4.65 to $5.05 for tipped employees.
The 80-cent hike for non-tipped employees will be the largest in the state’s 16 years of annual increases, U.S. Department of Labor data shows.
That’s because the increases were tied to the rate of inflation by a constitutional amendment, and this year, inflation climbed to nearly 40-year highs. The Consumer Price Index used in the formula rose 8.7% between Sept. 1, 2021, and Aug. 31, 2022.
That amendment took effect in 2007. That year, the minimum wage rose from $4.25 to $6.85 — a $2.60 increase.
The increases are meant to counter the ever-rising costs of goods and services. A $6.85 wage in November 2007 had about the same buying power as a $9.70 wage in November 2022, according to the U.S. Bureau of Labor Statistics.
The federal minimum wage is $7.25 and hasn’t changed since 2009. But with inflation, its real value is at its lowest point in decades, NewsNation reported.
Ohio’s new minimum wage applies only to businesses that gross at least $372,000 a year, and to employees who are at least 16 years old. Otherwise, the minimum hourly wage is set to the federal minimum wage of $7.25.
Ohio’s 2021 minimum wage of $9.30 was the 23rd lowest among all 50 states, according to the U.S. Department of Labor. It rose 50 cents from 2020, which was the largest annual increase since 2007.
A new ballot initiative to raise Ohio’s minimum wage to $15 per hour could go before voters next year.
If approved, the state’s minimum wage would rise incrementally over three years, starting in 2025, to reach $15 per hour for non-tipped employees on Jan. 1, 2028. Tipped employees who take home more than the equivalent of $15 per hour with tips and hourly wages combined would have a minimum wage of $14 per hour by 2028.
The minimum wage would then continue to increase each year, based on inflation.
The state ballot board approved the measure in November, and organizers are now collecting signatures from voters in at least 44 of Ohio’s 88 counties, FOX 8 sister station WCMH reported.