ANALYSIS: Minimum Wage Increase in PA House Bill Would Benefit 1.34 Million Pennsylvanians


HARRISBURG – The Keystone Research Center today released an analysis of HB 1500, a bill to raise Pennsylvanian’s minimum wage for the first time since 2009 that passed through the PA House recently. Overall, more than 1.34 million Pennsylvania workers would see their wages rise by 2026, the vast majority of whom are adults (89%) and are disproportionately women (60%) and people of color (30%).

Also, as noted by Keystone Research Center Senior Research Analyst Claire Kovach, “Decades of robust minimum wage research show that the prices of goods and services do not rise sharply after minimum wage increases, and that wage increases are not passed along to consumers in the form of substantially higher prices.”

The analysis estimated that:

  • By 2024: The minimum wage would be raised to $11 on January 1st, 2024, and 532,000 Pennsylvania workers would see their wages rise.
  • By 2025: The minimum wage would be raised to $13 on January 1st, 2025.  An additional 193,000 Pennsylvania workers would see their wages rise, bringing the total to 725,000 Pennsylvania workers.
  • By 2026: The minimum wage reaches $15 per hour on January 1st, 2026. An additional 612,000 Pennsylvania workers would benefit, and the wage will then be indexed to inflation.

Every border neighbor has raised its state minimum wage since Pennsylvania last raised its wage because of a bump in the federal minimum wage to $7.25/hour 14 years ago.

Two weeks ago, Keystone Research Center released an updated analysis of economic activity near the New York/Pennsylvania border and the New Jersey/Pennsylvania border to determine how vast differences in the minimum wage between the states would affect employment and wages in two low-wage sectors, along with leisure and hospitality, and retail.

The analysis finds that wages increased more in New York and New Jersey, dramatically so in the leisure and hospitality sectors. Employment trends differed little from state to state with one exception—leisure and hospitality employment grew significantly more in New York.

Keystone Research Center Executive Director Stephen Herzenberg made the following statement earlier this month when HB 1500 passed the PA House:

“The PA House’s minimum wage increase is long overdue—16 years since the last Pennsylvania minimum wage increase, a period in which the U.S. and Pennsylvania minimum wages have sunk to the lowest inflation-adjusted value since 1956. The increase is also a modest one. It will take two more years than Governor Shapiro proposed to get to $15 per hour. Further, the tipped minimum wage will increase to only 60% of the regular minimum wage, despite the fact that research shows the seven ‘one fair wage’ states have seen growth in employment in low-wage industries on par with that in states with very low minimum wages. There is a real question about whether this 2024 minimum wage increase to $11 per hour will be sufficient to stem the exit of Pennsylvania workers to take better jobs in New York, New Jersey, and Maryland. Given these economic realities, the Pennsylvania Senate should pass the House bill as is with a bipartisan majority and without further erosions.”

The bill currently awaits action in the Pennsylvania State Senate.

You can read the analysis of who is helped if HB 1500 became law here.