On January 1st, 10 states, including Missouri, are scheduled to raise the minimum wage. Missouri’s minimum wage will jump up by 10 cents to $7.35 per hour. And, the pay increases could provide a nice bump in the state’s economy.
The minimum-wage increase comes after state voters approved a 2006 proposition to keep the minimum wage at a rate matching the growing cost of living.
A study by the Economic Policy Institute suggests the increase will affect 79,000 workers in the state. That translates to an extra $190 dollars annually in the pocket of a worker who earns the minimum wage.
David Cooper is an economic analyst at the Institute. He says the extra dime per hour could help boost the U.S. gross domestic product by $8.6 million: “Low wage workers are more likely to spend every additional dollar that they have just to get by. That additional spending increases economic activity, which means more demand for businesses, goods and services, and overall economic activity tends to go up a little bit.”
Cooper says that most of that money will likely be spent within states’ borders since low-wage workers tend to be less mobile. With the increase, Missouri now sits 10 cents above the federal minimum wage.