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5 facts to know about Michigan's minimum wage increase

May 30, 2014

LANSING — Michigan Gov. Rick Snyder signed legislation Tuesday to raise the state's minimum wage to $9.25 an hour by 2018, as Republicans controlling the state government moved to head off a November ballot measure that could have raised pay even more. Here are five facts to know about the impact on Michigan workers and the ballot drive:

1. Gradual raise

The Republican governor approved a 25-percent wage raise from the current hourly minimum of $7.40, but Michigan workers won't see the increase all at once. The first bump comes in September, when the minimum wage moves up to $8.15. From there, it increases to $8.50 on Jan. 1, 2016, to $8.90 on Jan. 1, 2017 and to $9.25 on Jan. 1, 2018.

Lawmakers said the gradual increase is better for employers who might need time to adjust to paying employees more.

Some other states that have raised their minimum wages this year are using a similar gradual method, but none will rise as slowly as Michigan's wage. Maryland is increasing from $7.25 to $10.10 by July 2018, and Minnesota will go from $6.15 to $9.50 for large employers and from $5.25 to $7.75 for small employers by August 2016, according to the National Conference of State Legislatures.

If current inflation trends continue, $9.25 will only be worth about $8.50 by 2018, said Charles Ballard, an economics professor at Michigan State University. A minimum-wage earner would need to make about $8.00 an hour in 2018 to be making relatively the same as $7.40 today, he said, citing U.S. Bureau of Labor Statistics data.

2. Ballot drive

Michigan is the first state with a Republican-led legislature to raise its minimum wage this year. That's because Republican leaders in Michigan were working to pre-empt a ballot initiative they said was a worse alternative: raising the minimum wage to $10.10 an hour by 2017. Senate Majority Leader Randy Richardville, R-Monroe, said he introduced the bill to repeal and replace the law that the ballot initiative aims to amend.

But it is unclear if the new law will prevent the $10.10 measure from appearing on the November ballot. Raise Michigan, the group of labor and community organizers behind the ballot drive, submitted 319,784 petition signatures in support of the ballot initiative by the filing deadline Wednesday.

Raise Michigan attorney Mark Brewer, former chair of the Michigan Democratic Party, said according to the state Constitution, the Michigan Secretary of State's office must now review the signatures and follow the usual ballot process, because it is a "valid" drive approved by the state Board of Canvassers. He wouldn't say whether Raise Michigan plans to sue the state.

"We will do whatever's necessary to protect the peoples' right in this state to pursue an initiative," Brewer said.

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