Arizona Raises Minimum Wage in 2022

Arizona saw a minimum wage increase to $12.80 an hour for 2022. This baseline standard will put Arizona ahead of several other states, but it will still be far behind some local minimum wages. Increases range from .08 cents to $1.50 an hour, which roughly translates to $166-$3,120 more a year. 


Details on the Increase


The Industrial Commission of Arizona announced the new statewide wage minimum in September. This is an increase from the previous minimum of $12.15 in 2021. Back in 2016, voters mandated that a higher wage reflect the 5.3% US Consumer Price Index rise. The rate has pushed higher to 6.8% this past Fall. 


The tipped minimum wage in Arizona is up to $3 less than the state’s minimum wage. As in years past, employers must provide records showing that tips make up the difference and that employees receive at least minimum wage. 




There are some important exemptions to Arizona’s new minimum wage. Those employed by the Arizona state government or federal government are exempt. There are also exemptions for those employed by a sibling or parent. 


Another exemption is for those who work casually as babysitters in the home of an employer. Small businesses under $500,000 of annual revenue are also exempt. 


The Effects of the Increase


In the past, estimates would be made about the number of workers affected by the raise, as well as the average raise for each worker per state. Unfortunately, due to the circumstances raised by the pandemic, these are not viable estimates. This is in large part due to the labor market devastation throughout the country. Lower-wage workers, including those who receive minimum wage, were hit the hardest.


Arizona Leads the Way


This increase ranks Arizona 7th on the list of states with the highest minimum wage in the US. It trails California, Washington, Massachusetts, Connecticut, New York, and New Jersey to varying degrees, according to the Labor Law Center. 


As another frame of reference, the federal minimum wage remains at $7.25 an hour. It is just $2.13 an hour for tipped employees. This federal minimum wage is the same one still used by 19 different states. 


It is estimated that 26 states will see minimum wage increases in 2022, so other states should soon follow Arizona’s lead.