A hiring sign hangs in a window of Wendy's on Western Avenue in Augusta. Credit: Linda Coan O'Kresik / BDN

AUGUSTA, Maine — Maine’s minimum wage will increase to $12.75 per hour next year to adjust for inflation, the Maine Department of Labor announced Thursday.

The increase is in accordance with a 2016 referendum, which was approved with 55 percent of the vote. It increased the hourly minimum wage to $12 effective in 2020, with adjustments based on the cost of living index each year after that. For 2021 the adjustment amounts to a 60-cent increase, from $12.15 to $12.75. The tipped minimum wage, which is required to be half of the regular minimum wage, will also increase to $6.38.

The change will likely affect tens of thousands of workers who make minimum wage currently. As of 2019, about 78,000 workers made less than $12 per hour, according to state data. But that number may have changed significantly in the past two years as the COVID-19 pandemic has rejiggered the state’s economy, with some service employers increasing wages to draw back employees uncertain about working in-person due to risk of the virus.

Wages will go up more in Portland, which passed its own minimum wage ordinance last fall. Under the law, which will raise the minimum wage to $15 by 2024, Portland employers will have to begin paying $13 hourly in 2022.