What is Wisconsin's minimum wage, and why hasn't it changed when other states' minimum wages have?
About half of all states in the U.S. increased their minimum wage at the start of the year, or will do so later in 2024.
Wisconsin isn't one of them — it remains one of 20 states that'll keep its minimum wage at $7.25, the federal minimum.
Despite lawmakers' attempts to find solutions to workforce shortages, and Democratic Gov. Tony Evers declaring 2024 the "Year of the Worker," historically there hasn't been much momentum in the state to increase the minimum wage.
But why is that? How does Wisconsin's minimum wage compare to other states? How has the amount been affected by inflation?
Here's a guide to some of those most-asked questions:
What is Wisconsin's minimum wage?
Wisconsin's minimum wage is $7.25 per hour. Young workers under age 20 can be paid a $5.90 "opportunity wage" during the first 90 days of employment.
There's also a minimum wage of $2.33 for workers who receive tips in Wisconsin. If tips, combined with that hourly rate, don't total $7.25, the employer must cover the difference.
There are also special rates for golf caddies and camp counselors, according to the state Department of Workforce Development.
What is the 'living wage' in Wisconsin?
According to a calculator developed by the Massachusetts Institute of Technology, the living wage for an adult with no children in Wisconsin is $16.06 an hour. In a household with two working adults and two children, it's $25.20.
The living wage varies by location. In the Milwaukee area, the living wage for an adult with no children is $16.10. In Madison, it's $17.49. In Eau Claire, it's $15.19, and in Wausau, $14.47.
That amount takes into account basic needs like food, housing and transportation, but not extras like going out to eat, taking vacations or saving for retirement.
More: What's a good paying job in Milwaukee? These are the industries with the highest-paid workers
How does Wisconsin's minimum wage compare to neighboring states?
Illinois increased its minimum wage by a dollar to $14 in January and will boost it to $15 in 2025. Tipped workers are paid $8.40 hourly, and minors working less than 650 hours a year are paid $12.
Michigan raised its minimum wage from $10.10 to $10.33. Minors now get $8.78 an hour, and tipped employees get $3.93.
Minnesota also raised its amounts to account for inflation. Large employers, with annual revenue over $500,000, must pay $10.85 an hour. For smaller employers, it's $8.85. Minors must also be paid $8.85.
Minneapolis and St. Paul are also raising the minimum wage — $15.57 hourly for employees working in the Twin Cities, except for some small businesses.
Iowa is similar to Wisconsin — the minimum wage there is $7.25. The tipped wage is $4.35 an hour if the employee makes $30 or more per month in tips.
More: Minnesota's higher minimum wage has minimal effect on nearby Wisconsin businesses
Can cities in Wisconsin raise the minimum wage on their own?
Unlike the Twin Cities, local governments in Wisconsin were barred from going beyond the state's minimum wage as part of a compromise signed in 2005 by then-Democratic Gov. Jim Doyle to boost the state's amount.
And before a 2017 law prohibited it, local governments like Milwaukee County had approved "living wage" ordinances for government workers and contractors' employees.
What's the history of minimum wage laws in Wisconsin?
Legislation to set a minimum wage in Wisconsin was introduced in 1911. In 1913, the first wage law in Wisconsin said that women and minors must be paid a "living wage," though it took a few years to determine that amount.
The first minimum wage for women and minors in Wisconsin was $0.22 in 1919. Future wage amounts took into account age, the population of a city or village, and the length of employment.
When was the last time Wisconsin's minimum wage increased?
Wisconsin's minimum wage hasn't increased since 2009, when the federal minimum wage was also set at $7.25.
In 2006, the minimum wage for non-agricultural employment was $6.50 for adults and $5.90 for minors. A year prior, it was $5.70 for adults and $5.30 for minors.
How has inflation in Wisconsin affected the minimum wage?
If the $7.25 minimum wage set in 2009 was indexed for inflation to have the same purchasing power, it would be $10.33 now.
Low-wage workers have found it especially hard to afford higher housing costs, even before a spike in prices in 2022, explained Laura Dresser, associate director of the High Road Strategy Center (formerly COWS, a left-leaning think tank) at the University of Wisconsin-Madison.
More: A snapshot of Wisconsin's economy: remarkably strong job growth, warning signs ahead
Who would be affected the most by a raise in Wisconsin's minimum wage?
Dresser's research has found that increasing the minimum wage to $15 over the next five years would increase wages for one in seven workers in Wisconsin. That includes one of every four Black and Hispanic workers.
Half the workers who'd get raises are in the retail or restaurant industry, Dresser said.
"These are the places where wages are lower," she said. "You're looking at labor markets and looking where wages are consistently the lowest, closest to the wage floor, (are) restaurants and retailers."
Why isn't Wisconsin's minimum wage increasing?
Democratic lawmakers have proposed changes to the wage rules, including eliminating the tipped wage and allowing local governments to set wage ordinances. They soon plan to reintroduce an "Economic Justice Bill of Rights" that includes "a job that provides dignity at work and pays a living wage."
But Republicans who control legislative committees typically don't hold public hearings for bills authored only by Democrats, limiting their chances to get votes and reach the governor, who would likely approve changes to the minimum wage.
"Regardless of a public hearing or not, we know the public has a lot going on, especially working families," said Rep. Francesca Hong, a Democrat from Madison who has led the bills. "Part of our job is to remind them that we're still fighting for these policies, fighting for them first."
Has Evers tried to increase the minimum wage?
Evers has also proposed increasing the minimum wage in his state budget proposals. In 2023, he wanted to increase the amount to $8.25, then to $9.25 by 2025 and $10.25 by 2026, followed by adjustments for inflation. He also pitched a task force to study options for creating a $15 minimum wage in Wisconsin.
Republicans typically scrap hundreds of items Evers wants and write their own state budget plan. This past budget season, the budget they sent to Evers didn't include minimum wage increases.
What's the opposition to raising the minimum wage in Wisconsin?
The Republican chairs of three committees that could schedule hearings on the bills above didn't respond to requests for interviews. Republican legislative leaders don't often comment on the issue, though some have previously argued it would hurt small businesses.
Wisconsin Manufacturers & Commerce, the state's largest business lobby, which typically supports Republican candidates and causes, opposes raising the minimum wage, according to its 2023-24 legislative agenda.
"I think a lot of employers are very concerned about young people in particular being left out of the workforce," Rachel Ver Velde, WMC's director of workforce, education and employment policy, said in an interview.
"If the minimum wage increases, it'll have a disproportionate effect on those young people who are just trying to get into the workforce and trying to gain some experience, which ultimately hurts employers long-term, because their future employees may not have any work experience before walking in their doors," she said.
Dresser counters by saying evidence from other states shows stability or growth in sectors after raising the minimum wage, countering the "dominant theme" that people could get thrown out of work.
Why are some Wisconsin businesses offering more than the minimum wage?
While Wisconsin's required wage hasn't increased, many employers have offered higher hourly rates, in the $15 to $30 range, plus sign-on bonuses and other benefits, as they struggle to recruit workers.
WMC's Ver Velde said the "vast majority" of employers are paying above minimum wage, and most entry-level jobs aren't starting below $13.
"We heard from 73% of our membership that they're planning on increasing wages more than 3%," she said. "It's significant wage increases to bring people in the door, and they're having to provide competitive benefits, across all sizes of companies, in order to fulfill that labor shortage."
While workers have more leverage now, Dresser said, that doesn't mean the labor market will stay that way forever.
"We always think we're living in the new, recession-free world, but we never are," she said.
The minimum wage floor is "about extending that clarity, that regulation, and making a standard across the board ... and then being able to hold that for different conditions of the labor market."
More: Wisconsin companies are hiring. Here are a few offering higher wages and sign-on bonuses
Hong said there should be efforts to level the playing field between large and small companies, as not all businesses are able to offer the same types of benefits to employees.
"Just like we have different tax brackets for different incomes, we should absolutely allow for some of the wages for higher-earning companies to go up as well," she said.
This article originally appeared on Milwaukee Journal Sentinel: What is Wisconsin's minimum wage, and why hasn't it changed?
