Critics say the increase will force small-business owners to lay off employees.
Pennsylvania will raise its minimum wage to $7.15 an hour over the next year, making it the latest state to depart from the federal level of $5.15.
The new law, signed by Gov. Ed Rendell on Sunday, will boost the minimum wage to $6.25 starting Jan. 1, 2007, and bump it up again to $7.15 on July 1, 2007. Employees with 10 or fewer full-time employees will follow a delayed implementation schedule, which will span over a two-year time period.
"This bill provides a fairer wage for more than 420,000 hard working Pennsylvanians who deserve a raise," Rendell said in a statement.
The law also provides for a 60-day training wage, based on the federal $5.15 level, for employees under 20 years of age. The law makes it clear that other workers may not be displaced to allow hiring of training-wage workers.
Critics attacked the increase as a burden for business owners that will force them to lay off employees. "This new law is not going to create a single job in Pennsylvania," said Kevin Shivers, the Pennsylvania state director for the National Federation of Independent Business. "Small-business owners will be handing out pink slips come January."
According to Shivers, unskilled workers will be the ones most affected.
"At the end of the day, the people that get hurt are those with low skills, low education levels, and teenagers who are new to the workforce -- the exact people lawmakers say this law will help," Shivers said.
Pennsylvania joins 19 other states plus the District of Columbia that now have a minimum wage above the federal mandate.