Governor Steve Bullock announced on Friday that Montana’s minimum wage will increase from $8.65 per hour to $8.75 per hour beginning January 1, 2021.
The minimum wage is determined by taking the current minimum wage of $8.65 and increasing it by the CPI-U increase from August of 2019 to August 2020. The CPI-U increased by 1.31% (unadjusted) over the year ending August 2020.
To keep the minimum wage at the same purchasing power as the prior year, the wage should increase by $0.11 per hour. However, since state statute requires the wage to rounded to the nearest 5 cents, the 2021 minimum wage rate will be $8.75.
In 2020, the District of Columbia and 29 U.S. states, including Montana, have minimum wage rates that exceed the federal rate of $7.25 per hour.
The state reports that an estimated 8,000 to 10,000 Montana workers, or around two percent of the workforce, received hourly wages less than $8.75 per hour in 2020.
At the beginning of 2020, the minimum wage in the state was raised from $8.50 to $8.65.
From the U.S. Department of Labor (website):