by California’s statewide minimum wage is set to rise again in 2026, increasing by 40 cents to $16.90 per hour starting January 1. The adjustment is part of an automatic inflation-based system created nearly a decade ago and will impact millions of workers across the state.
The increase follows California law passed in 2016, when then-Governor Jerry Brown approved legislation gradually raising the minimum wage to $15 per hour and requiring annual cost-of-living adjustments thereafter. Since then, the rate has continued to climb in response to inflation.
Why the Minimum Wage Is Going Up
Under state law, California’s minimum wage must be adjusted yearly based on changes in the Consumer Price Index, with the goal of preserving workers’ purchasing power as living costs rise.
According to the National Low Income Housing Coalition, the current minimum wage already falls short of meeting basic housing needs. Data cited by CalMatters shows that a minimum wage worker earning $16.50 per hour would need to work 98 hours a week to afford a one-bedroom apartment at fair market rent in California.
California Ranks Among the Highest in the Nation
With the 2026 increase, California will hold the fourth-highest statewide minimum wage in the U.S., trailing only:
- Washington, D.C. – $17.95
- Oregon – $17.13
- Connecticut – $16.94
California will be among 19 states raising their minimum wage in 2026, alongside states such as New York, New Jersey, Washington, Arizona, Colorado, and Michigan.
Local Minimum Wages Will Rise Even Higher
Beyond the statewide rate, dozens of cities and counties across California will enforce higher local minimum wages, many of which exceed $18 per hour. Several jurisdictions already implemented increases in mid-2025, while others will take effect on January 1, 2026.
Below are confirmed local minimum wages based on data from the UC Berkeley Labor Center:
- West Hollywood: $20.25
- Emeryville: $19.90 (July 1, 2025)
- Sunnyvale: $19.50
- Mountain View: $19.70
- San Francisco: $19.18 (July 1, 2025)
- Berkeley: $19.18 (July 1, 2025)
- Richmond: $19.18
- Petaluma: $18.31
- San Jose: $18.45
- San Mateo: $18.60
- Palo Alto: $18.70
- Santa Clara: $18.70
- Los Angeles: $17.87 (July 1, 2025)
- San Diego: $17.75
Some cities apply different rates based on business size, with slightly lower wages for small employers.
Separate Wage Rules for Certain Workers
California also enforces industry-specific minimum wages that are higher than the general statewide rate:
- Fast-food workers at large chains have earned at least $20 per hour since 2024 under state law.
- Health care workers are on a phased schedule that will eventually reach $25 per hour, depending on facility type and size. Most currently earn between $18 and $24 per hour.
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What This Means Going Into 2026
The upcoming increase means higher payroll costs for employers and slightly larger paychecks for workers, though housing and living expenses continue to outpace wage growth in many regions.
Employers are encouraged to review local ordinances carefully, as city and county rates often exceed the state minimum. Workers should also verify whether they are covered by a sector-specific wage law that guarantees a higher hourly rate.
As inflation remains a key concern statewide, California’s minimum wage system ensures yearly adjustments — but whether those increases are enough to keep up with the cost of living remains an open question.
What impact do you think the 2026 minimum wage hike will have on workers and small businesses in your area? Share your thoughts below.
