Florida minimum wage reaches $15: What workers need to know
Florida's minimum wage increases to $15
Florida’s minimum wage is set to reach $15 an hour Wednesday, completing a six-year increase approved by voters in 2020. FOX 13's Kellie Cowan reports.
TAMPA, Fla. - Florida’s minimum wage is set to reach $15 an hour Wednesday, completing a six-year increase approved by voters in 2020.
Florida minimum wage increase
By the numbers:
The new wage affects an estimated 1.2 million Floridians. A full-time minimum-wage worker could earn about $2,100 more per year compared with the previous rate.
Florida voters approved a plan in 2020 to increase the state’s minimum wage by $1 each year until it reached $15 an hour.
The wage rose from $9 to $10 in 2021 and continued increasing annually. Today’s increase from $14 to $15 marks the final scheduled dollar increase under that plan.
The minimum wage will now be adjusted annually for inflation.
The required cash wage for tipped workers, including servers and bartenders, increases to $11.98 an hour. Tips can be used to make up the remaining $3.02 needed to reach the $15 minimum.
Supporters say the increase will put more money in workers’ pockets and could boost consumer spending.
Florida now ranks 13th in terms of highest minimum wage pay, which is now more than double the federal floor.
The federal minimum wage has remained at $7.25 an hour since July 2009.
Business labor costs
Why you should care:
The increase gives eligible workers a higher wage base, but it also raises operating costs for businesses.
USF Assistant Professor Leo Chen said adding $1 per hour across a staff could result in tens of thousands of dollars in additional annual labor costs for businesses.
"For example, a business with 15 hourly employees, this $1 could increase their overall cost for the year above $40,000. If you use 5% net profit margin, then that would require over $800,000 revenue increase," Chen said. "So, even though business owners have seen this coming, they will still have to gradually increase prices."
Labor costs can also affect overtime calculations. Johan Gutierrez, CEO and founder of Oceanview Financials, works with restaurants across Florida and said some businesses may reduce overtime or staff levels.
Business automation adjustments
What's next:
Businesses will begin operating under the new $15 minimum wage immediately.
Restaurant and hospitality leaders say they will continue evaluating staffing, operating hours, prices and automation as they adjust to the higher wage.
The Source: The information in this story was gathered from the text of Florida's 2020 voter-approved constitutional minimum wage amendment, economic analysis provided by USF Assistant Professor Leo Chen, business consulting updates from Oceanview Financials CEO Johan Gutierrez, and previous reporting by FOX 13.