Minimum Wage Goes Up January 1, 2025
It’s the end of the year.
Which means, for the foreseeable future, employers need to be mindful of the automatic increase to the state’s minimum wage which goes into effect on January 1, 2025.
Currently, the rate is $ 15.69. However, it goes up to $ 16.35 on Wednesday.
Why?
Connecticut’s minimum wage law, which connects the state minimum wage to changes in the federal employment cost index (ECI), was originally passed in 2019 when inflation wasn’t of major concern.
The minimum wage is required to be adjusted each year based on the USDOL’s calculation of the ECI for the 12 month period ending on June 30 of the preceding year. Thus, in case you were wondering, the ECI increased by 4.2 percent over the 12 month period ending June 30, 2024.
What will the increase be next year? Well, we’ll have to wait for that, but judging by the Q3 release, the ECI is showing signs of decreasing. For the trailing 12 month period as of September 30, 2024, the ECI was 3.9 percent.
For employers, the minimum wage increase impacts not only those at the lowest end of the pay spectrum but others too since employers continue to have to be concerned about salary compression.
Regardless, the time to make the change is now.