Arizona minimum wage going up to $12.80 an hour on Jan. 1

Arizona’s minimum wage will increase from $12.15 an hour to $12.80 an hour on Jan. 1 under a law approved by the state’s voters in 2016 that gradually increases the bottom rate employers are allowed to pay.

The state’ minimum wage was just $8.05 an hour when groups that advocate for low-income workers collected enough signatures to put a ballot measure boosting the lowest wages on the ballot. The measure was opposed by Republican Gov. Doug Ducey and business groups like the Arizona Chamber of Commerce and Industry. They argued it would hurt the state’s economy but that that did not happen. Instead, Arizona’s economy has soared.

Voters approved Proposition 208 by a 58% to 41% vote in November 2016. Wages went to $10 an hour the following year and have increased every year since. The measure also guaranteed paid sick time.

The federal minimum wage remains at $7.25 an hour because Republicans in Washington won’t back an increase. That rate applies in states that do not have their own minimum wage laws.

Voters in Flagstaff raised that city’s minimum wage in 2016 as well. It now sits at $15 an hour and will go to $15.50 an hour in January. Tucson voters approved their own minimum wage increase last month. Wages there will rise to $13 an hour in April and will hit $15 per hour in 2025.

Wage increase affects employers differently

At Gabriella’s Restaurant in Scottsdale, owner and chef Anthony Barr probably won’t notice the mandatory wage increase because he’s paying his employees above that already.

"We can retain our employees and have them here long term," Barr said. "We’re always wanting to build for their future - also, that’s kind of our way here."

Barr's philosophy: adapt. Whether it's inflation or higher wages, he tries to make it work.

"I change my menus regularly," Barr said. "I look for the best costs out there for me. Chicken wings are higher priced so we’ll do something different, we’ll do chicken skewers…I want to enjoy where I’m at, and I want the same people who work for me to enjoy where they’re at also."

A number of businesses have already upped their wages this year in an attempt to lure in more workers.

The Arizona Chamber of Commerce says the pay bump might hit a rural area in the state harder.

"Rural Arizona might be a different story because workers are harder to come by, and your margins are tighter there," said Garrick Taylor with the Arizona Chamber of Commerce. "So we’re ready looking at some tough decisions in rural Arizona."

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