INDIANA — While a new year typically brings change, Indiana’s lowest-paid workers are waking up to a familiar reality in 2026. For the 16th consecutive year, the state’s minimum wage remains locked at $7.25 per hour, matching a federal floor that has not moved since July 2009.
Despite several legislative attempts over the years to modernize the rate, there are no plans for an increase in the Hoosier State this year. This stands in stark contrast to 19 other states that implemented pay raises on January 1, 2026.
Indiana’s “stagnant” status is increasingly highlighted by the actions of its neighbors. As of the start of the year, several nearby states have significantly higher wage floors:
| State | 2026 Minimum Wage | Recent Change |
| Illinois | $15.00 | Effective Jan 1 |
| Michigan | $13.73 | Increased from $12.48 |
| Ohio | $11.00 | Increased from $10.70 |
| Indiana | $7.25 | No change since 2009 |
The Affordability Crisis
For Hoosiers earning the minimum rate, the math for survival is becoming nearly impossible. A full-time worker at $7.25 per hour earns approximately $1,160 per month before taxes.
According to recent data from Redfin and Zillow, the average monthly rent for a one-bedroom apartment in Indiana now falls between $1,100 and $1,400.
“We’re 16 years without an increase; it’s kind of crazy,” said Kyle Anderson, an economist at the IU Kelley School of Business. “It’s definitely low, and a lot of people would benefit if it moved up.”
While some economists warn that sharp increases could drive up business costs and contribute to inflation, labor advocates argue the issue is one of morality and basic survival. Indiana AFL-CIO President Brett Voorhies called the long-term freeze “insane,” noting that the current wage fails to cover the basic costs of gas, groceries, and housing in 2026.
Previous efforts to raise the wage—such as Senate Bill 106 and House Bill 1345, which proposed gradual hikes to $15—failed to gain traction in the Indiana General Assembly. For now, Indiana remains one of 20 states that strictly adhere to the federal $7.25 minimum, leaving many workers to hope for federal intervention that has also been stalled for over a decade and a half.
