What used to seem like a pie-in-the-sky pay rate—$15 an hour, to start—gains momentum for low-wage American workers in key locales now that 2018 has officially begun.
A new minimum wage has gone into effect in Seattle, paying new hires $15.45 per hour, and in the Seattle suburb of Seatac, a $15.65 floor, the highest in the land.
Among other locales where the wage will be raised Jan. 1 are San Francisco, starting out at $15. New York City workers receive a floor minimum wage of $13 as of Sunday, Dec. 31. Washington, D.C., already has more generous hourly pay now than many other places and is on track to hit $15 an hour in 2020.
In addition, 18 states will give unskilled workers more money starting on Jan. 1., in wages that range from $8.85 to $11.50 an hour.
Some of those higher rates are nearly double the federal minimum wage, which has been stuck at $7.25 an hour since 2009. Congressional action is required to raise the wage.
Sen. Bernie Sanders, I-Vt., Sen. Patty Murray, D-Wash., and Sen. Chuck Schumer, D-N.Y., cosponsored a bill this spring to raise the federal minimum wage to $15 an hour by 2024. The $15-an-hour idea was also a rallying cry for Sanders when he ran for president during the last election cycle.
The federal minimum wage is the least a company can pay workers starting out if they don't work for tips. If a locale, such as Seattle or New York City, has not upped its minimum wage, the federal rate applies.
The push for $15 an hour as the floor wage began six years ago when the Fight for $15 pro worker group targeted fast food companies, especially McDonald's Corporation (MCD - Get Report) . It was then that 200 McDonald's workers walked off the job in New York City to demand higher pay and union rights. Today, the organization represents workers in 300 cities on six continents.
McDonald's has declined to reveal its hourly wages. Glassdoor.com has reported that an average McDonald's crew member makes $8.26 to $8.47 an hour, while cashiers earn $8.47. Trainers tend to draw more an hour, while shift and swing managers generally make slightly over $10 an hour.
The broader business community has taken a more gradual approach to upping rates. Target Corporation (TGT - Get Report) , for example, committed to up the starting wage to $11 an hour in October and plans to go to $15 an hour by the end of 2020.
Takeaway: profit margins for retailers and fast-food companies could be pressured in 2018 due to new minimum wage laws.
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