COLDWATER, MI (WTVB) – Michigan ’s standard minimum wage is set to rise from $12.48 to $13.73 per hour starting Jan. 1, 2026, marking a significant step in the state’s multi-year plan to reach a $15 base rate.
This $1.25 hourly increase applies to most workers across the state, while the minimum pay for minors aged 16 and 17 will climb from $10.61 to $11.67 per hour.
These adjustments stem from the Improved Workforce Opportunity Wage Act (IWOWA), which was passed following a 2024 Michigan Supreme Court ruling that mandated a faster timeline for wage hikes.
Tipped workers will also see an increase in their base pay, which will move from $4.74 to $5.49 per hour on New Year’s Day. Under the current legislative compromise, the tipped wage is set at 40% of the standard minimum wage for 2026. To remain in compliance, employers must ensure that a tipped employee’s total earnings—including at least $8.24 per hour in tips—reach the full $13.73 hourly minimum; if they do not, the employer is legally required to pay the difference.
The state’s minimum wage is scheduled to hit $15 per hour on Jan. 1, 2027. Following that milestone, future annual adjustments will be tied to the rate of inflation as calculated by the Michigan Treasurer each October.
While labor advocates have celebrated these increases as a victory for low-wage earners, some business organizations, including the Michigan Chamber of Commerce, have expressed concerns regarding the higher labor costs for small businesses and the hospitality industry.
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