Minimum wages are set to rise throughout the state come New Year’s Day — including in Portland, where the floor will rise more than 8%.
Statewide, the minimum hourly rate will go from $14.65 to $15.10 — up about 3.1% — for non-tipped workers. For those earning tips, the minimum will rise to $7.55 per hour.
The state’s minimum wage is pegged to the Bureau of Labor Statistics’ cost of living index for the northeast region, hence the 3.1% bump from last year.
In November, nearly two-thirds of Portland voters opted to increase the city’s minimum wage to $19 by 2028 through a series of incremental hikes. The first bump, slated for Thursday, will bring Portland’s non-tipped minimum wage from $15.50 to $16.75, an 8.1% increase.
For workers who regularly receive more than $191 in tips each month, the minimum wage will be $8.38 per hour in 2026. If those workers’ tips and base wages total less than $16.75 per hour combined, their employers must make up the difference.
Roughly 7,200 tipped and non-tipped workers in Portland will see their wages increase as a direct result of the new 2026 minimum, according to James Myall, an analyst with the nonprofit Maine Center for Economic Research. He added that another 4,700 workers making just above the minimum would likely see their wages rise.
Year-over-year inflation was about 3.1% in November 2025, according to the Bureau of Labor Statistics.
Myall noted that the price of essentials like energy and some groceries are already outpacing inflation. The minimum wage hikes will help workers stay afloat amid rising costs, he said.
“People are feeling it a lot more than that official data would suggest,” Myall said.
By 2028, when the final increase hits, Myall estimated that roughly 9,500 workers would be directly affected. Another 5,700 would see indirect impacts.
Apart from estimates from groups like Myall’s, it’s not clear exactly how many people will benefit from the wage increases. Neither the city nor the state track Portland’s minimum wage earners.
Zooming out
Similar to Portland, it’s not clear exactly how many Mainers will benefit from the 2026 increase, but estimates say the figure is likely in the tens of thousands.
There were about 35,000 workers in Maine making below $15 an hour in 2024, according to the latest data from the Maine Department of Labor. That’s about 9% of all employees making hourly rates.
The state relies on estimates drawn from federal survey data, meaning it does not have a precise count of minimum-wage workers, Maine Department of Labor spokesperson Jessica Picard said.
In another analysis, the Maine Center for Economic Research estimated that 42,000 workers are currently making less than $15.10 per hour and will see their pay rise next year. Another 17,000 tipped workers will also benefit from the increase, the center found. That report drew from a different source of federal data than the department uses.
Agricultural workers may also see their pay go up in 2026 because of a new law requiring them to make at least the state minimum wage. Currently, farmhands can earn as little as $7.25 per hour, the federal minimum.
Ripple effects?
Dan Stone, chair of Bowdoin College’s economics department, said economists tend to be concerned that increasing the minimum wage could also increase unemployment: Businesses might pursue staffing changes or be slower to hire newcomers as the cost of labor rises.
“One concern is unemployment,” he said. “An even greater concern is that businesses have to shut down altogether, or new businesses that would have been created are not created because the cost of labor (is) too high.”
Those impacts are more likely to be felt in the longer-term, while the short-term effects of wage hikes “tend to be fairly small,” Stone said.
“There’s a lot of debate about the magnitude, the research goes in different directions, but there’s going to be some negative effects, for sure,” Stone said.
Still, for working people trying to get by on a minimum wage, any increase can help the bottom-line, he said.
Paul Shea, an economics professor at Bates College, said the statewide increase is “quite small” and unlikely to trigger any noticeable effect on unemployment in the short term.
“Whatever impact on unemployment is going to come out of that is going to be probably too small to pick up,” Shea said.
He said Portland’s hike could be slightly more impactful, but it will be hard to tell for sure. With high unemployment and underemployment, “the labor market is clearly weakening,” minimum wage increase or no, he said.
“There could be a little bit of an effect there, but there’s so many things going at the same time,” Shea said.
This story was originally published by the Maine Trust for Local News. Daniel Kool can be reached at dkool@pressherald.com.