Michigan’s minimum wage set to rise 22 cents on Jan. 1, 2022

Labor shortage is not expected to end anytime soon

Photo of Angela Mulka
State law requires annual increases in the wage until it reaches $12.05 in a decade. The 22-cent raise was supposed to occur in 2021 but was automatically delayed because of high unemployment early in the coronavirus pandemic.

State law requires annual increases in the wage until it reaches $12.05 in a decade. The 22-cent raise was supposed to occur in 2021 but was automatically delayed because of high unemployment early in the coronavirus pandemic.

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Among changes that come with the new year is an increase in hourly pay for Michiganders set for Jan. 1, 2022.

Michigan’s minimum wage rate will increase to $9.87 from the current $9.65 as inflation is the highest ever in 13 years. Michigan’s Improved Workforce Opportunity Wage Act of 2018 establishes the annual schedule and increases.

State law requires annual increases in the wage until it reaches $12.05 in a decade. The 22-cent raise was supposed to occur in 2021 but was automatically delayed because of high unemployment early in the coronavirus pandemic.

The state also announced on Dec. 2 that the minimum wage for minors aged 16 and 17 is set to increase by 19 cents to $8.39 an hour.

In addition, workers who make tips will earn a base wage of $3.75 per hour, 8 cents more. Employers must pay any shortfall if the gratuities plus the minimum wage do not equal or exceed the standard minimum wage, according to a press release issued by the Michigan Department of Labor and Economic Opportunity.

Despite the 22 cent increase in Michigan, and other wage increases nationwide, the labor shortage is not expected to end anytime soon.

A survey of 529 American workers by the U.S. Chamber of Commerce released on Dec. 2 showed that less than half of those polled who lost their jobs during the pandemic and remain unemployed say they are actively and consistently looking for work, with one in five reporting they are not looking for work at all.

"Every day, we see more evidence of a worsening worker shortage," U.S. Chamber of Commerce President and CEO Suzanne Clark said in a statement. "With businesses across the country and in every industry struggling to find workers, it is deeply concerning that 35% of the unemployed say they are not very active in looking for work — or not looking at all. Policymakers at every level of government must act with urgency to get people back to work and help accelerate the economic recovery."

Additional analysis by the U.S. Chamber found that quit rates were highest in accommodation and food service (6.6%) and in arts, entertainment and recreation service (5.7%).

View a copy of the Improved Workforce Opportunity Wage Act and related resources here.