Oregon Minimum Wage rises to $8.80 in 2012

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by Andre Harboe
Oregon Employment Department

Oregon’s minimum wage rate will increase to $8.80 per hour on January 1, 2012. The state’s minimum wage is linked to inflation and will rise 30 cents per hour, or 3.5 percent. Oregon’s minimum wage has been set at $8.50 per hour since January 1, 2011.

Oregon had the second-highest state minimum wage in 2011, behind Washington. Oregon’s 2012 rate will remain lower than Washington’s minimum wage ($9.04 per hour as of January 1, 2012) but above the federal minimum wage rate, which rose to $7.25 per hour on July 24, 2009 and has stayed there since. The federal minimum wage is not adjusted annually for inflation.

According to payroll data, Oregon had roughly 137,000 jobs paying less than $8.80 per hour in the first quarter of 2011 that would be affected by the increase. This constitutes 8.2 percent of all jobs covered by Oregon’s unemployment insurance. Leisure and hospitality has the highest number with 53,100 jobs paying less than $8.80 and retail trade followed with 28,900 jobs. Industries in which a substantially larger-than-average share of jobs paid less than $8.80 per hour include leisure and hospitality, natural resources and mining, and retail trade.

Ballot Measure 25, enacted by Oregon voters in 2002, requires a minimum wage adjustment annually based on changes in inflation as measured by the U.S. City Average Consumer Price Index for All Urban Consumers for All Items (CPI-U). Oregon is one of 10 states that adjusts minimum wage based on inflation. The Commissioner of the Bureau of Labor and Industries is directed to adjust the minimum wage for inflation every September, rounded to the nearest five cents ( www.oregon.gov/BOLI).