Connecticut’s minimum wage will increase from $15.69 an hour to $16.35 on Jan. 1, according to a press release from Governor Ned Lamont’s office last Friday.
The press release states that the minimum wage increase was required by Public Act 19-4, which was signed into law in 2019.
According to a 2019 press release from the governor’s office, the law caused regularly scheduled increases in the minimum wage from the level of $10.10 when the bill was signed into law to $15 in June 2023. Beginning in January of this year, the minimum wage has been tied to federal economic indicators and continues to undergo increases annually.
“The Connecticut Department of Labor and Connecticut Voices for Children estimate those increases will raise wages for approximately 130,000 workers this year and more than half a million by 2024,” the 2019 press release said.
According to the recent press release, Connecticut Labor Commissioner Danté Bartolomeo said that the employment cost index increased 4.2% over the past year, accounting for the 4.2% increase in the minimum wage.
“This law that we enacted ensures that as the economy grows, the wages of low-income workers can grow with it,” Lamont said in he press release. “This is a fair, modest adjustment for workers who will invest their earnings right back into our economy and support local businesses in their communities.”
University of Connecticut Associate Professor of Economics William Alpert, Ph.D., said that these increases would lower hours and raise prices slightly, but that these increases would be trivial and the impact on university finances would also be trivial.
“This is a pretty low increase. You’re going to see directional impacts, it’s going to lower the amount of labor you use, raise the amount of prices that we pay, move technology towards labor-saving stuff,” Alpert said.
Automation is one way that companies substitute away from labor, according to Dr. Alpert.
“McDonalds now has totally automated restaurants in terms of counter staff,” Alpert said. “That’s because they have higher labor costs. Your self-checkouts in grocery stores are a way to substitute away from labor.”