Some States Consider Indexing Minimum Wage to Inflation

Automation looks increasingly attractive


At least 10 states are considering raising their minimum wages even as President Obama's proposal to increase the federal standard is stuck in Washington's political quagmire. In one of those states, New Jersey, voters rather than legislators will decide the issue. A measure that will be on the ballot this fall would increase the state's minimum wage by $1, to $8.25.

The New Jersey measure also would take politicians out of future hourly wage increases by including automatic annual adjustments for inflation, known as "indexing."

Obama endorsed indexing when he pressed for a $9 federal minimum wage in his State of the Union address:  "Here's an idea that Governor Romney and I actually agreed on last year—let's tie the minimum wage to the cost of living, so that it finally becomes a wage you can live on."

The current federal minimum wage, put in place in 2009, is $7.25 an hour.