4 States Vote to Raise the Minimum Wage, 1 Votes to Keep It As Is

South Dakota's ballot measure, which failed, would have actually reduced the minimum wage for some.
by | November 9, 2016
(AP/Elaine Thompson)

Read all of our coverage on 2016 ballot measures at governing.com/ballotmeasures.

In 2014, voters in South Dakota decided to increase the state minimum wage from $7.25 to $8.50 an hour. It was one of four Republican-led states that year that approved a minimum wage higher than what federal law requires.

Two years later, the state asked voters to do something no other state had done in recent memory: reduce the minimum wage. More than 70 percent of South Dakota voters rejected the measure, which would have created a lower minimum wage for workers under 18 years old.

Meanwhile, voters in Arizona, Colorado, Maine and Washington state decided to raise the minimum wage. In Washington's case, it will be one of the highest statewide minimum wages in the country.

In recent years, the Republican-controlled Congress -- as well as the growth of GOP-dominated legislatures and governors' offices -- has roadblocked Democrats' attempts to raise the minimum wage. As a result, efforts to increase it have shifted to the ballot box and been largely successful, even in red states.

The federal minimum wage is $7.25, the same level it has been since 2009. Going into the 2016 election, the District of Columbia and 29 states had a minimum wage above that. Congress has raised it 22 times from 25 cents in 1938, but rising living expenses have steadily pushed down its value since the late 1960s.

The following chart shows the incremental increases in each state’s minimum wage that voters approved. It does not include South Dakota, where the ballot measure sought to address pay for workers under 18 years old.

  2016 2017 2018 2019 2020
Arizona $8.05 $10.00 $10.50 $11.00 $12.00
Colorado $8.31 $9.30 $10.20 $11.10 $12.00
Maine $7.50 $9.00 $10.00 $11.00 $12.00
Washington state $9.47 $11.00 $11.50 $12.00 $13.50

While the four states had similar proposals -- each tied to inflation -- some critics were focused on the finer details.

In Maine, for example, some restaurant owners opposed the wage hike because it applied to workers who get the majority of their pay from tips. Most states let business owners pay less than the federal minimum wage if workers make that much in tips. But Maine's ballot measure didn't allow for such an exemption.

The Economic Policy Institute, a left-leaning think tank in D.C., argues that servers and bartenders don't make enough in tips to compensate for their lower wages. According to a 2011 study, the median wage for tipped workers was $9.87 compared to $15.59 for all workers. The study also found twice as many tipped workers living in poverty.

Restaurants' business model relies on tips so they can keep employee costs down. In September, Greg Duggal, president of Restauranteurs for a Strong Maine Economy, told Governing that owners wouldn't be able to cover the difference by just raising menu prices."It’s going to result in a reduced number of employees, reduced number of hours, reduced number of benefits," he said.

In South Dakota, the initiative would have affected teenagers looking for their first job. State Sen. David Novstrup, a Republican who supported the measure, said he was worried that employers were pickier now that they have to pay young, unskilled workers a slightly higher wage.

But Cory Allen Heidelberger, who ran the political action committee SD Voice and was against cutting the youth minimum wage, said he's "heard no hew and cry from employers or from kids that they can’t find a job."

Heidelberger also said the ballot question was unfair because the people who would have been most affected by it had no say. “That’s the tricky thing about this minimum wage cut,” he said. “They only cut it for people who can’t vote.”

A majority of Americans favor increasing the federal minimum wage, though support is stronger among Democrats and independents than Republicans. Support also varies by the size of the proposed increase. In May, Public Policy Polling found that 78 percent of registered voters favored a $10 minimum wage, but only 49 percent supported a $12 minimum wage.

This year, every state's proposal raised the wage floor to at least $12 in 2020. Accounting for inflation, $12 in 2020 would be roughly equal to $1.60 in 1968, when the minimum wage had the most buying power.

Read all of our coverage on 2016 ballot measures at governing.com/ballotmeasures.