Media Release: Colorado to Increase Minimum Wage on New Year’s Day

Local Chapter: Colorado
FOR IMMEDIATE RELEASE: December 19, 2012
Contact: Bridget Kaminetsky, 9to5 Colorado,, 303-628-0925

On January 1, 2013, Colorado’s full minimum wage and tipped minimum wage will each increase by 14 cents to $7.78per hour and $4.76 per hour, respectively, benefiting an estimated 66,000 low-wage workers in the state. Colorado’s minimum wage increase means an extra $300 per year in wages for the average directly affected worker, and the increased consumer spending generated by the minimum wage hike will boost GDP by $11 million, according to an analysis by the nonpartisan Economic Policy Institute. Colorado is joined by nine states – Arizona, Florida, Missouri, Montana, Ohio, Oregon, Rhode Island, Vermont, and Washington – that will also raise state minimum wage rates on New Year’s Day, boosting wages for nearly one million workers nationwide.

“An increase in pay from $4.62 to $4.76 will be very beneficial for me,” said Jessica Smith, a tipped worker from Denver, Colorado, and a member of 9to5 Colorado. “I would not have to choose between everyday life necessities. It may not sound like a lot, but with $25 more per month I would not have to turn off my heat to ensure I will be able to afford enough groceries for the month.”

“With a raise in the minimum wage, I can spend less time working and more time studying,” said Derek Esquibel, a student at Metro State University in Denver, Colorado. “Metro costs almost $7,000 per year, and even with my scholarships, that’s a lot of money.”

Colorado’s minimum wage increase is the result of a state constitutional amendment approved by voters in 2006 that provides for annual rate adjustments to keep pace with the rising cost of living. An estimated57,000 workers in Colorado will be directly impacted as the new minimum wage rate will exceed their current hourly pay, and 9,000 more will see a raise as pay scales are adjusted upward to reflect the new minimum wage, according to an analysis of government data by the nonpartisan Economic Policy Institute. Sixty-eight percent of these low-wage workers are over 20 years old; 74percent work 20 hours per week or more; 42 percent have at least some college education. Click here for a complete demographic breakdown.

While weak consumer demand is holding back business expansion, raising the minimum wage puts more money in the pockets of low-wage workers who have little choice but to spend that money immediately on basic expenses. In total, the minimum wage increases taking effect in all ten states on January 1, 2013, will generate over $183 million in new economic activity and create the equivalent of 1,500 new full-time jobs.

As of January 1, 2013, nineteen states plus the District of Columbia will have minimum wage rates above the federal level of $7.25 per hour, which is just over $15,000 per year for a full-time minimum wage earner. Colorado numbers among ten states that increase their minimum wage rates annually to ensure that real wages for the lowest-paid workers do not fall even further behind: Arizona, Colorado, Florida, Missouri, Montana, Nevada, Ohio, Oregon, Vermont, and Washington. Nevada has not scheduled a cost of living adjustment to take effect this year.

Because the federal minimum wage is not indexed to rise with inflation, its real value erodes every year unless Congress approves an increase. Without further action from Congress, the current federal minimum wage of $7.25 per hour will lose nearly 20 percent of its real value by 2022 and have the purchasing power of only $5.99 in today’s dollars, according to a new data brief by the National Employment Law Project.

The Fair Minimum Wage Act of 2012, introduced in the U.S. Senate and House of Representatives in July, would help recover much of this lost value by raising the federal minimum wage to $9.80 by 2014 and adjusting it annually with rising living costs thereafter. The Fair Minimum Wage Act would also raise the minimum wage for tipped workers from its current low rate of $2.13 per hour, where it has been frozen since 1991, to $6.85 over five years. Thereafter, it would be fixed at 70 percent of the full minimum wage.

A large body of research shows that raising the minimum wage is an effective way to boost the incomes of low-paid workers without reducing employment. A groundbreaking 1994 study by David Card and Alan Krueger, current chair of the White House Council of Economic Advisers, found that an increase in New Jersey’s minimum wage did not reduce employment among fast-food restaurants. These findings have been confirmed by 15 years of economic research, including a 2010 study published in the Review of Economics and Statistics that analyzed data from more than 500 counties and found that minimum wage increases did not cost jobs. Another recent study published in April 2011 in the journal Industrial Relations found that even during times of high unemployment, minimum wage increases did not lead to job loss.

Strengthening the buying power of low-wage workers is especially critical in this economic climate. A recent study by the National Employment Law Project reveals that, while 60 percent of jobs lost during the recession have been middle- and high-wage occupations, low-wage occupations have accounted for 58 percent of jobs created in the post-recession recovery.

9to5 has been fighting for paid sick days, equal pay, and family-supporting jobs with decent wages for forty years. As one of the largest, most respected national membership organizations of working women in the U.S., 9to5 lifts up the voices of women in low-wage jobs, builds leadership skills and empowers women to bring about real change. To learn more, please visit

Jobs with Justice has been a national network of local coalitions that bring together labor unions, faith groups, community organizations, and student activists to fight for working people for twenty five years. Our members are in the streets in 46 cities in 24 states across the country. To learn more, please visit

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