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Montana’s minimum wage will increase to $8.50 on Jan. 1

Montana Governor Steve Bullock announced on September 28, 2018, that Montanans earning minimum wage will see the rate increase to $8.50 per hour beginning January 1, 2019.

“Every Montanan who works hard should have the opportunity to get ahead. We’re among a handful of states where each year minimum wage workers take home a little extra in their paychecks, but there’s more to be done,” said Governor Bullock. “We must continue to help working families succeed by bringing in better jobs, helping businesses expand and investing in areas like apprenticeships and education.”

In the 2006 General Election Montana voters approved Ballot Initiative I-151 to raise the minimum wage and require that the minimum wage be adjusted annually for inflation. As a result, Montana Code Annotated Section 39-3-409 requires the Department of Labor and Industry to adjust the Montana minimum wage for inflation using the CPI-U.

The minimum wage rate for 2019 was determined by taking the current minimum wage of $8.30 and increasing it by the CPI-U increase from August of 2017 to August 2018. The CPI-U increased by 2.68% over the year ending August 2018. To keep the minimum wage at the same purchasing power as the prior year, the wage should increase by $0.223 per hour. The resulting wage is $8.523 and statute specifies that the wage must be rounded to the nearest 5 cents.

An estimated 8,200 Montana workers, 1.8% of the workforce, currently earn less than $8.50 per hour and are likely to see higher wage rates in 2019 due to the increase. In 2017, the industry with the largest number of workers earning minimum wage was the accommodations and food services industry followed by the retail trade industry. Food Preparation Workers and Sales are occupational groups with large number of minimum wage workers.

Source: Montana Department of Labor and Industry, News Release, September 28, 2018; 2019 Minimum Wage Rate Determination.