Arizona’s minimum wage is set to increase from $13.85 to $14.35 on Jan. 1, 2024.
The 50-cent increase is a result of The Fair Wages and Healthy Families Act, which "establishes a new state minimum wage each year through 2020, with annual raises thereafter based on the increase in the cost of living," according to the Industrial Commission of Arizona.
"We look at the Bureau of Labor Statistics consumer price index, and we see how that has increased from year to year and then we increase the minimum wage accordingly," Trevor Laky, chief of legislative affairs at the ICA, said. "So the process is laid out for us, we just put pen to paper."
Naomi Saria, an economist for the U.S. Bureau of Labor Statistics, said this increase in minimum wage is reflective of the rising cost of living in the state's densely populated cities.
"Over the last 12 months, the CPUI, the consumer price index that measures how much urban consumers are paying, saw an overall advance of 2.9% (in the Phoenix area)," Saria said. "That could be a potential reason or push for the minimum wage increase. Prices rose 3.4% over the past four months."
Saria said many major U.S. metropolitan areas are also witnessing parallel changes despite the federal minimum wage of $7.25 remaining unchanged since 2009.
"In San Francisco, I think (minimum wage) recently increased by $1.08 to $18.07" Saria said. "That is a reflection of an increase in inflation over time and trying to help accommodate for the cost of living in that area. I see a similar pattern in Arizona, the high cost of living for concentrated populations in metro areas."
Marian Rosenberry, a junior studying public service and public policy with a focus in business, works at the ASU Tempe campus. Her food service job on campus currently pays minimum wage, but does not allow employees to take home tips.
"My coworkers have pointed out that after tax, that's less than the minimum wage. And then also, it's an on-campus job and we're not allowed to accept tips. I didn't realize that I make no supplemental income," Rosenberry said. "It's a job that should and usually is tipped. But we are not allowed to accept tips."
The Arizona Minimum Wage Increase Initiative could be on the Nov. 5, 2024 ballot and would change the minimum wage to $18 an hour. The initiative, presented by Raise the Wage AZ, has a due date of July 3, 2024.
The initiative would require tipped employees to be paid a base pay of the minimum wage. It would also force small businesses, including those exempt from paying the federal minimum wage, to pay employees the state minimum. Rosenberry said she still feels hesitations in celebrating a wage increase.
"With inflation, is it actually increasing? Or is it just moving up the same way that everything else is moving up in costs?" Rosenberry said.
Edited by Alysa Horton, Sadie Buggle and Caera Learmonth.