Missouri minimum wage will increase in 2024 with cost of living
JEFFERSON CITY, Mo. (KMIZ)
Missouri's minimum wage is increasing by 30 cents in 2024 from $12 to $12.30 per hour -- the first time it will be based on inflation instead of a voter-approved amount in five years.
The Missouri Department of Labor reports starting in 2024, the minimum wage rate will be based on an increase or decrease in the Consumer Price Index's cost of living. Missouri voters approved Proposition B in 2018, which allowed the state's minimum wage to increase 85 cents per hour each year from 2018-2023.
The wage increased from $7.85 per hour to the current $12 per hour under Proposition B.
Taylor Hurley is a barista and full-time student in Columbia who said on average, she makes slightly above minimum wage at her current job. Still, she said most of her income goes toward necessities.
"Every paycheck is pretty much spent on bills, groceries, gas," Hurley said.
She welcomes any sort of increase to the state's minimum wage.
"I think that minimum wage, when it was instituted, it was supposed to be a livable wage, and I don't think that's what it is now," Hurley said. "I think every increase that we can implement is a great idea."
The Missouri Economic Research and Information Center reports Missouri's cost of living index for the third quarter of 2023 was 88.3 when comparing it to the national average, which is pegged at 100. It is the state with the sixth lowest cost of living in the U.S.
The state's grocery and housing costs are below the national average but utilities are slightly higher than average.
The data show Columbia has a higher cost of living than the state at 90 on the index. Grocery costs are listed at 96, housing at 81 and utilities slightly lower than the rest of the state at 95.5.
Verna Laboy, program manager at Boone County Upward Mobility, said community members are struggling, and $12.30 per hour isn't enough.
"That's not even $2,000 a month gross," Laboy said. "If you're a single family head of household person, that's impossible without supports from outside in the community."
University of Missouri professor and Kenneth Lay Chair in Economics Joe Haslag said this small, 30 cent increase--compared to previous years' 85 cent increases--is a big deal.
"It's a big deal because it looks like the inflationary pressures are showing up in how the Missouri Industrial and Labor Relations Board is treating the minimum wage increase," Haslag said.
He said an extra 30 cents an hour is likely compensating workers for how much goods and services will increase next year.
"Whatever purchasing power they enjoyed this year with the minimum wage, when their minimum wage goes up, that 30 cents it will compensate them enough to continue the same standard of living, same purchasing power" Haslag said.
He said this is also a sign inflation rates are cooling, and rates will continue to ease over the next several months.
With the increase in minimum wage, tipped employees will still be required to be paid at least 50% of the minimum wage, which now puts them making $6.15 per hour. Overtime compensation must be paid at 1.5 times a regular rate for a 40-hour work week.
The Department of Labor said the 30-cent increase begins Jan. 1 and applies to all private and non-exempt businesses. It does not apply to public employers.
Haslag also said an increase in minimum wage will likely result in some people losing their jobs, as some employers won't want to pay under-achieving workers a higher wage.
Laboy said anyone needing financial assistance can get support from organizations such as the Columbia Housing Authority, Love Columbia, Voluntary Action Center and Central Missouri Community Action.
