A bill in the Minnesota Legislature would increase the state minimum wage to $15, and increase every year until it reaches $20 in 2028. 

The current Minneapolis minimum wage of $15 will not see any immediate effects from the wage increase, but will in the following years. After the initial increase on January 1, 2025, the minimum wage will increase by $1.25 every year. 

Minimum wage advocates are pushing for the wage increase as the cost of living in Minnesota exceeds the state minimum wage of $10.85, according to the Economic Policy Institute. Bill author Sen. Zaynab Mohamed (DFL-Minneapolis) said the bill will help workers earn a livable wage. 

“Minnesota’s current minimum wage remains far below the living wage in every corner of Minnesota,” Mohamed said. “It has been far too long since we last raised the minimum wage, and I’m glad to hear many senators say $10.85 per hour is not enough in 2024.” 

Restaurants nearby have a different opinion on the minimum wage increase.

Katie Essler, district manager of Black Coffee and Waffle House, believes the minimum wage increase is good for employees but more needs to be done to protect small businesses.

“The idea of upping the minimum wage is a good idea, but I think a lot of other things would need to be put in place to help assist small businesses in getting to that point,” Essler said. 

If passed, the minimum wage increase will take effect in August, according to the bill.

National Federation of Independent Businesses State Director John Reynolds said he worries the increase in minimum wage will have a negative effect on small businesses in Minnesota. 

“Their biggest concern is when you increase the cost of employing workers, you make it harder to employ workers and harder to keep doors open,” Reynolds said. 

Sen. Glenn Gruenhagen (R-Glencoe) said in a committee hearing on March 19 that workers need a livable wage but that the minimum wage increase in the bill goes too far. 

“We want people to earn a living wage at a rate that can help them experience the American dream,” Gruenhagen also said in the hearing. “One of the things you have to understand is this. When you grow government at a rate faster than population and private sector, you actually go backward.”

Reynolds said tax credits or subsidies are ways to protect minimum wage employees without hurting small businesses. 

“In turn, this is going to force a lot of them to cut back on employment or close their doors because they can’t afford to stay open,” Reynolds said, referring to a lack of action. “I think that that’s what state lawmakers need to strive for, is, ‘How do you help without hurting?’” 

Essler said her store will survive but hopes the legislature will consider other ways to support small businesses. 

“Larger corporations can afford to absorb it,” Essler said. “They ship so much of their labor overseas and they can ship it out to states with a lower minimum wage and it doesn’t really affect them. For businesses that are founded in the state of Minnesota and based entirely in the state of Minnesota, all of our labor and all of our product purchasing is happening here.”