MACRO USED: H:\Prod\Template\Dir-Ltrhd.dotm
A
ugust 1, 2025
Honorable Gavin Newsom
Governor
Hon
orable Mike McGuire
Senate President pro Tempore
Honorable Brian W. Jones
Senate Republican Leader
Honorable Scott Weiner, Chair
Senate Budget and Fiscal Review
Committee
Honorable Anna Caballero, Chair
Senate Appropriations Committee
Hon
orable Robert Rivas
Speaker of the Assembly
Hon
orable James Gallagher
Assembly Republican Leader
Hon
orable Jesse Gabriel, Chair
Assembly Budget Committee
Hon
orable Buffy Wicks, Chair
Assembly Appropriations Committee
Mi
nimum Wage Increase, Director of Finance Calculation of Adjustment Lab
or Code section 1182.12 (c) requires the Director of Finance to annually calculate an adjusted minimum wage on or before August 1 of each year following the implementation of the minimum wage to $15.00 per hour for all employers, which occurred on January 1, 2023. The Director’s calculation of the adjusted minimum wage must be the lesser of 3.5 percent or the rate of change, as specified, for the United States Bureau of Labor Statistics non-seasonally adjusted United States Consumer Price Index for Urban Wage Earners and Clerical Workers (U.S. CPI-W). The adjusted minimum wage increase takes effect on January 1 following the calculation. Pursuant to section 1182.12, the minimum wage was increased to $16.50 per hour on January 1, 2025, for all employers.
This
year, the Department of Finance calculates the average U.S. CPI-W for the 12-month period from July 1, 2024 to June 30, 2025 increased by 2.49 percent compared to the 12-month period from July 1, 2023 to June 30, 2024. As a result, pursuant to section 1182.12(c), the minimum wage shall increase by 2.49 percent to $16.90 per hour and shall be implemented for all employers on January 1, 2026. -2-
If you have any questions or need additional information regarding this matter, please call Susan Wekanda, Principal Program Budget Analyst, at (916) 445-5332.
JO
E STEPHENSHAW
Director
cc: H
onorable Roger W. Niello, Vice-Chair, Senate Budget and Fiscal Review Committee
Honorable Heath Flora, Vice-Chair, Assembly Budget Committee Gabriel Petek, Legislative Analyst (3)
Elisa Wynne, Staff Director, Senate Budget and Fiscal Review Committee Kirk Feely, Fiscal Director, Senate Republican Fiscal Office Christopher W. Woods, Budget Director, Senate President pro Tempore's Office (2) Christian Griffith, Chief Consultant, Assembly Budget Committee Joseph Shinstock, Fiscal Director, Assembly Republican Caucus, Office of Policy and Budget
Paul Dress, Caucus Co-Chief of Staff, Assembly Republican Leader’s Office Katja Townsend, Capitol Director, Assembly Republican Leader’s Office Jason Sisney, Budget Advisor, Assembly Speaker's Office (2) Mark McKenzie, Staff Director, Senate Appropriations Committee Jay Dickenson, Chief Consultant, Assembly Appropriations Committee