Jan. 2—The new year brings a gift to low-wage workers in Maine.
The state’s minimum wage jumped from $12.75 to $13.80 an hour on Jan. 1, and in Portland, the minimum increased from $13 to $14 an hour. Minimum wage workers clocking 40 hours a week under the new state minimum will earn an extra $42 weekly, and full-time workers in the city will earn an extra $40 a week.
It is unclear how many workers this will affect — many businesses have already raised hourly wages for many positions to try to compete in a labor market in which staffing shortages have made it difficult to fill many jobs.
But James Myall, an economic policy analyst for the Maine Center for Economic Policy, said the increases are important, even if most Maine workers are already earning well above the mandated state minimum, let alone the federal minimum wage of $7.25 an hour.
The state’s minimum wage is based on a regional measure of the cost of living. The 8.2% state wage increase and $1 an hour increase in Portland will help minimum wage earners cover housing, heating, food and gasoline costs that rose substantially last year as inflation soared to levels not seen in decades, Myall said.
The locally-owned Sea Dog Brewing Co. was advertising some jobs Friday at the 2022 state minimum of $12.75 an hour, and that increased Sunday. But most of the company’s workers were making more than that already, said Emma Downey, manager of the Sea Dog Brewing Co.’s pub on Western Avenue in South Portland. Sea Dog Brewing has 11 locations in Maine, New Hampshire and Florida.
Downey said the company had already been increasing wages because of the labor shortage — dishwashers typically earn $17 to $18 an hour and cooks $22 to $23 an hour. Most restaurants, including the national chains that Sea Dog competes with, are paying the same wages and Downey hopes potential workers will prefer to deal with a smaller, locally-owned company than a national chain.
Some workers already making above the state or city minimum will still get a pay hike this month because their hourly wage increases when the legal minimum does.
Michael Zeigler, who works at a Circle K in Saco, said he gets paid $4 an hour more than the state minimum wage. He said he’s happy for any minimum wage workers getting a pay hike because rising prices mean it’s hard to make ends meet, even for those earning more than the minimum.
But Amanda Tarbox, a cashier at Bob & Mike’s Mini Mart in Saco, said she thinks increasing the minimum wage is unfair to employees who have stayed in one job and worked their way up to earn higher pay.
“It’s unfair to people who have been there for a while,” she said. “I don’t make minimum wage, but I worked my way up.”
Tarbox said that as far as she knows, everyone at Bob & Mike’s makes more than the state minimum. She declined to say what she is paid.
Portland’s minimum wage is higher than the state’s, but that gap has shrunk. Voters in 2020 approved increasing the minimum by a dollar an hour each year, topping out at $15 an hour in 2024.
The Portland minimum will also apply to city workers, city spokesman Mo Puia confirmed Friday. Because the minimum wage was set via referendum, city government isn’t required to follow it, but City Hall is taking that step voluntarily, Puia said.
Increasing “the minimum wage is one of those things that has consistently had approval,” said Myall, the economic policy analyst.
City voters in November rejected an effort to increase the minimum wage even more, up to $18 an hour by 2025.
But Myall said he thinks that initiative failed because the proposal also called for eliminating the “tipped minimum wage,” which allows employers in service industry jobs — restaurants and bars, for instance — to count part of an employee’s tips toward their hourly wage.
In other words, if an employee is supposed to make a minimum wage of $13.80, an employer can count up to $6.90 an hour of the employee’s tips toward meeting that minimum. If the proposal — Question D on the November city ballot — had passed, employers would have had to pay at least the full city minimum wage, and employees would still have been able to keep all their tips. Some tipped workers opposed Question D, fearing their tips would go down if their minimum base pay went up.
Nonetheless, Myall said, Maine voters’ backing for raising minimum wages remains strong and is especially important at a time when some companies are racking up record profits, regardless of inflation.
“It’s important that some of that goes down to the workers,” he said.
Some lawmakers in recent years have launched unsuccessful attempts in the Legislature to lower the minimum wage, arguing that higher labor costs hurt Maine businesses that compete with those in other states, Myall said.
Fifteen states follow the federal minimum wage of $7.25 an hour, where it has been since 2009. That’s the longest gap between increases in the federal minimum wage since the law that allows Congress to set the minimum was approved in 1938.
Maine, and Portland, have among the highest minimum wages in the country, according to the most recent data from the federal Department of Labor. Washington, D.C., has a minimum wage of $16.10 per hour, Washington state’s is $14.49, Massachusetts’ is $14.25 and California and Connecticut have a $14 per hour mimimum.