St. Paul minimum wage increases to $16.37 for small businesses, $14.25 for microbusinesses

July 2, 2026 - 09:48

Starting July 1, workers at small businesses in St. Paul are seeing a pay bump as the city's minimum wage climbs to $16.37 per hour. For microbusinesses, the rate has increased to $14.25 per hour. The change is part of a phased schedule adopted by the city council to gradually raise wages across different business sizes.

Small businesses, defined as those with more than 100 employees, now face the higher rate. Microbusinesses, which employ five or fewer workers, have a lower threshold but are still moving toward the city's ultimate goal of a $15 per hour minimum wage. The city's larger employers have already been paying $16.37 since last year.

The increases aim to help low-wage workers keep up with the cost of living, which has risen sharply in the Twin Cities metro area. Supporters of the hike argue it puts more money into the pockets of essential workers, from restaurant staff to retail clerks. Critics, however, warn that smaller operations may struggle to absorb the added labor costs, potentially leading to reduced hours or staff cuts.

St. Paul's wage ordinance includes annual adjustments tied to inflation, meaning future increases are likely. The city remains one of several Minnesota municipalities with its own minimum wage, setting it apart from the state's base rate of $11.13 per hour. For now, employees at small and micro businesses can expect their paychecks to reflect the new rates immediately.