With the start of the new year, Delaware quietly continued its march toward a $15 minimum wage with an increase of $1.25 an hour.
The new hourly minimum wage of $11.75 an hour began Jan. 1 and applies to tens of thousands of workers around the state – although perhaps not to the extent that proponents had envisioned in 2021 when Senate Bill 15 approved the prorated hikes.
The post-COVID labor market shortage has driven many employers around the state to raise their minimum wages well above $11.75 though – often around $18 to $20 an hour – even with no advanced degrees or prior work experience.
According to current job ads, those include some of the most common entry-level jobs like McDonald’s, which is hiring around the state at $14 an hour; Amazon, hiring at $18 or more; and Target, hiring at $15.25 an hour, among others.
Delaware is one of 23 states that increased their minimum wage on Jan. 1, with four more states and Washington, D.C., scheduled for hikes later in the year. It already has approved further increases to $13.25 in 2024, and $15 in 2025.
When passed in 2021, SB15 was projected to impact about 150,000 Delawareans, including then-35,000 workers earning the state’s base pay of $9.25. A new accounting by the state Department of Labor of the latest increase’s impact estimates that nearly 93,000 workers would be affected – about 66,550 earning the minimum wage of $10.50 and 26,125 more who earned between $10.50 to $11.75. Agriculture and farm workers were exempt from the bill under Delaware’s labor laws.
SB15 puts Delaware on an aggressive pay bump schedule compared to its Mid-Atlantic neighbors. Maryland, for example, has a slower timeline for employers with fewer than 14 workers, giving them an additional 18 months to reach $15 an hour. New Jersey has a similar provision for small employers and seasonal workers. It also spaces out wage increases over six years before reaching $15, compared to four years under SB15.
SB15 swiftly cleared the Democrat-controlled House and Senate in 2021, despite objections and concerns coming mostly from industry lobbyists, Republican lawmakers, some business owners and chambers of commerce throughout the state.
The bill spurred a contentious debate, as opponents of SB15 warned such an increase may cause employers to cut hours and positions, thus hurting the very people the bill is intended to help. Restaurant industry advocates said hospitality employers wouldn’t be able to absorb the steep increases in such a short amount of time. And some non-profit leaders said they’d need more funding to afford the wage hike.
But others, including business owners, said the increase will help attract workers to Delaware with the promise of higher wages, therefore decreasing turnover and allowing Delaware to remain competitive with surrounding states.
Business for a Fair Minimum Wage, an advocacy group, pushed for the hike and organized some local small business owners to push its message here. They included Canalside Inn owner Kristen Deptula who said she has paid her employees $15 an hour since buying her Rehoboth Beach hotel in 2019.
“As a hospitality business, customer service is a top priority. We know that creating a good environment for our guests starts with creating a good workplace for our employees. Delaware’s minimum wage increase will bolster our state workforce and boost the economy,” she said in a recent statement marking the annual wage increase.