These Republican-leaning States Went Big on Minimum Wages. Here's What Happened to their Restaurant and Retail Jobs. [View all]

Arin Dube
Apr 08, 2026

During the past decade, voters in four Republican-leaning states — Arizona, Florida, Missouri, and Nebraska — enacted big minimum wage increases. These four were the only non-Democratic-leaning states with a minimum wage of $13 an hour or more in 2025, and they all are currently at, or will reach, $15 an hour by the end of 2026. By using ballot initiatives, voters in these states bypassed their legislatures that had failed to pass similar increases, even though the minimum wage is a very popular policy. By 2025, the population-weighted minimum wage across these states had nearly doubled from around $7.80 to $14.00 an hour. Meanwhile, 20 other states— like Texas, Georgia, or Tennessee—kept their minimum wage at the federal floor of $7.25, unchanged since 2009. These 20 (also Red or Purple) states serve as a clean “control group” for our four “treatment” states. A nice “natural experiment.” The map below shows these two groups of states.

So, what happened? Based on administrative payroll data covering nearly every private-sector employer in all 24 states from 2014 through 2025, the answer is clear: wages rose substantially, while restaurant and retail employment was unaffected.

(snip)

Arizona’s minimum jumped to $10 in 2017, and reached $14.70 by 2025. Florida’s Amendment 2 — which passed with 61% of the vote — began phasing in at $10 in 2021, and is heading to $15 by 2026. Voters in Missouri approved increases twice, first in 2018 and then in 2024. Nebraska started at $10.50 in 2023, reaching 13.50 by 2025 and is also heading to $15. These were not small changes. By 2025, the minimum-to-median wage ratio (also called the Kaitz index) in these states had reached 55–59%, with a (population weighted) average of 57%.

This places them alongside California (58%), Washington (56%), and New York (56%) in terms of the bite of the minimum wage. In fact, Arizona’s 59% is the highest Kaitz index of any U.S. state today; state-level Kaitz indices for the 30 states range between 37% and 59%, with a median of 52%. Internationally, a Kaitz of 57% puts these red minimum wage states in a similar range as Germany (~57%) and Canada (~55%), and not far from Australia (~61%) or the UK (~66%). (These OECD comparisons adjust for the fact that OECD Kaitz ratios use full-time-worker medians; scaling by ~1.1 makes them comparable to all-worker medians, as I discuss in my new book, The Wage Standard.) In contrast, the federal minimum of $7.25 yields a 28% Kaitz index, making it the very lowest in the OECD by a wide margin. These Red- and Purple-state ballot initiatives have elevated their wage floors into the range that most high-income peer countries would consider normal.

https://arindube.substack.com/p/these-republican-leaning-states-went?r=os6na&triedRedirect=true