California to Raise Minimum Wage to $17.40 by 2027, Prioritizing Working Families

California is set to implement a significant increase in its minimum wage, with Governor Gavin Newsom announcing the hourly rate will reach $17.40 by January 1, 2027. This move positions California with the highest state minimum wage in the U.S., far exceeding the federal minimum of $7.25 per hour, which has remained stagnant since 2009.

Newsom contrasted California's approach with that of "Trump and Republicans," whom he accused of blocking federal minimum wage hikes while providing tax benefits to the wealthy. "California has chosen a different path, one that rewards work, boosts the economy, and prioritizes working families," Newsom stated. He emphasized the disparity, noting, "They think $7.25 an hour is enough; we do not."

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California has chosen a different path, one that rewards work, boosts the economy, and prioritizes working families.

This wage increase is part of a broader trend in California, which has seen its minimum wage climb steadily. It rose from $12 when Newsom took office to $16.90 in July 2026, culminating in the $17.40 rate in 2027. Additionally, a separate agreement will raise the minimum wage for fast-food workers to $20 per hour. These state-level adjustments occur against a backdrop of inflation disproportionately affecting lower-income households.

California's economic performance under Newsom's governorship has been robust, with the state's GDP growing by over $1.18 trillion to reach $4.25 trillion in 2025. This economic output ranks California as the fourth-largest economy globally, surpassing countries like Germany and India. The state also continues to lead in new business creation, venture capital attraction, and technological innovation, factors Newsom links to his administration's wage and economic policies.

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They think $7.25 an hour is enough; we do not.