The California minimum wage 2026 increase to $16.90 triggers new thresholds for exempt workers and adds pressure from broader labor laws taking effect next year.
The minimum wage in California will increase on January 1, 2026, this time to $16.90 per hour, marking another step in the state’s ongoing effort to adjust wages to the rate of inflation and the cost of living. Although the 40-cent increase may seem small, it has significant effects. The new figure also raises the required wage for exempt employees, impacts certain special categories, and relates to several new labor laws that will take effect in 2026. Because of this, employers need to prepare.
The minimum wage in California has risen steadily since 1916, when it was just $0.16 per hour. It reached $1 in 1957 and $10 in 2016. The new wage of $16.90 for 2026 places California among the jurisdictions with the minimum wages in the country, ranking fourth after Washington, D.C., Washington State, and Connecticut.
The 2026 increase comes from a legal mechanism that allows for annual adjustments of up to 3.5% when national inflation exceeds 7%. This process raised the minimum wage to $16 in 2024 and $16.50 in 2025. Similarly, many cities and counties will apply wages higher than the state rate, as they have done in the past. Some sectors, such as fast food and healthcare, will also maintain higher wage floors.
L.A.’s $30 Minimum Wage: A Win-Win for Workers, Hotels, and the Local Economy
