Hawaii hikes minimum wage to $18 an hour by 2028

Tourists on Honolulu beach. BROCHURE

Hawaii lawmakers on Tuesday approved a bill raising the state’s minimum wage to $18 an hour by 2028.

Hawaii’s current minimum wage is $10.10 an hour, which the bill would raise incrementally over the next several years, starting with $12 on Oct. 1.

The $18 minimum would be the highest in the nation, although some states automatically raise their minimum wage with the rise in the cost of living. Therefore, states like California, which currently has a $15 minimum wage, could have a higher wage in six years’ time given inflation, according to an AP report.

Wage hike supporters contend that it is needed because the cost of living in Hawaii is among the steepest in the United States.

House Speaker Scott Saiki said a study showing that 42% of Hawaii households struggle to make ends meet was a big factor behind his support for the increase. The AFL-CIO in Hawaii also endorsed the minimum wage hike.

The Democratic-controlled state House and Senate overwhelmingly approved the bill, which now awaits signing by Gov. David Ige who supports the minimum wage increase.

A state analysis published in December showed a single person working 40 hours a week must earn $18 an hour to pay for living necessities in Hawaii.

But the Chamber of Commerce of Hawaii warned that many business operators say they will lay people off or close shop with the rate hike.

The bill expands the tip credit to $1.50 by 2028, allowing employers to subtract that amount from the wage they pay if the workers earn enough in tips.