Understanding the impact of Alaska’s proposed $15 minimum wage

This November, Alaska voters will decide whether to increase the state’s minimum wage to $15 an hour by 2027.1 This new wage floor will produce significant increases for Alaska’s low-wage workers, helping them make ends meet amid high costs of living throughout the state. The minimum wage increase w...

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Bibliographic Details
Published in:Policy File 2024
Main Authors: Costa, Daniel, Hira, Ron
Format: Report
Language:English
Subjects:
Budgets
Cost control
Employment
Minimum wage
Wages & salaries
Online Access:Request full text
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Summary:This November, Alaska voters will decide whether to increase the state’s minimum wage to $15 an hour by 2027.1 This new wage floor will produce significant increases for Alaska’s low-wage workers, helping them make ends meet amid high costs of living throughout the state. The minimum wage increase will help lock in the wage gains low-wage workers have experienced during the economic recovery from the pandemic and will create greater equity by disproportionately lifting wages for women, workers of color, and parents. Alaska’s current minimum wage falls short of providing true economic security for low-wage workers. A modest estimate of a living wage for Anchorage residents is $18.58 an hour. The proposed minimum wage increase would lift wages for 30,800 workers, roughly ten percent (9.7%) of Alaska’s wage-earning workforce. In total, the increase would put $51,141,000 in the pockets of workers. More than half (55.1%) of workers that would get a wage increase are women. The minimum wage increases would also disproportionately benefit workers of color. Hispanic workers make up 13.3% of the affected workers; and American Indian, Alaska Native, and multiracial workers are 22.7% of the workers receiving wage increases. Minimum wage workers are from all walks of life. Most workers getting an increase - 78.4% - would be 20 years old or older. Nearly 1 in 5 (19.1%) are parents. Alaska’s current minimum wage ($11.73 an hour as of January 1, 2024) falls short of covering the basic expenses of working people in the state. EPI’s Family Budget Calculator (FBC) measures the monthly and annual costs families need to afford a modest standard of living in each county in the United States. (In Alaska, the primary substate jurisdictions are boroughs.) These estimates include essential expenses for a secure life including food, housing, health care, and transportation, but omit other expenses many would consider critical, such as retirement and education savings. The FBC estimates can also be customized to account for families of various sizes and with different numbers of children.