LINCOLN — Nebraska’s minimum wage will annually increase at 1.75%, no longer by the cost of living, and certain teen workers, starting this July, can be paid a subminimum wage that will remain below the current $15 guarantee for nearly 40 years.

Lawmakers secured just enough support to approve Legislative Bill 258 from State Sen. Jane Raybould of Lincoln, 33-16. That’s the minimum threshold to modify the wage increases that 59% of voters approved in 2022, including with majority support in 38 of the state’s 49 legislative districts. Voters also approved wage bumps in 2014.

“This is a request from many of the business communities,” Raybould said.

Employers can choose to pay workers above the minimum wage, currently $15, at any time.

Slower Than Cost Of Living?

The state’s minimum wage will rise 1.75% each Jan. 1, so $15.26 next year.

Dating back to 2000, cost of living for the Midwest region, the measurement tool that voters wanted to set the increases, has ranged from a 1.9% decline in 2009 to an 8.7% increase in 2022, according to data from the U.S. Bureau of Labor Statistics.

Average inflation for the Midwest over the past 26 years has been 2.4%. The change to 1.75% increases would likely lead to slower-paced increases.

Raybould said making increases “fixed and predictable” is important. She and supporters have said the alternative could increase prices, particularly for retailers of all sizes, fast food restaurants, convenience stores, day care centers and more.

Nebraska Gov. Jim Pillen is expected to sign the law. It would take effect by mid-July, three months after lawmakers adjourn this spring.

Youth Minimum Wage

That means employers of workers aged 14 or 15 will have the option of a new “youth minimum wage” of $13.50. It increases by 1.5% every five years, beginning in 2030. 

“We are confident that the employers who have hired 14 and 15 year olds will maintain them at the current minimum wage, and then, going forward, new hires in July will now be at the wage differential,” Raybould said.

The change means the state’s youngest workers — who face additional restrictions under the U.S. Occupational Safety and Health Administration — will be guaranteed a higher wage for the next four months than some of their peers, siblings, children and grandchildren until 2065. 

By then, the state minimum wage will be $29.51, and the youth wage will rise to $15.20, the first time above $15, according to an Examiner analysis of future wage bumps. Some supporters of Raybould’s bill said lawmakers could always step in if needed.

State Sen. Terrell McKinney of North Omaha, whose district had the highest support for the ballot measure in 2022, at 89.67% approval, blasted the proposal for its message to Nebraskan youths. He was a ballot sponsor for the 2022 initiative. He said he didn’t think Nebraska was China or a “third world” country.

“We don’t care about our youth,” McKinney said. “We just want discounted labor.”

State Sen. Tony Sorrentino of the Elkhorn area said the youth wage would still be more than most other states, and Nebraska’s would be among the highest in the country.

“We’re not taking aim at youth in Nebraska,” Sorrentino said.

State Sen. Mike Jacobson of North Platte, who supported the effort, described the measure as a “job protection bill” so businesses don’t fire workers or cut hours to make ends meet.

Revived Bill Passes

During third-round debate last year on Raybould’s bill, the final step needed to pass it, Sorrentino missed the vote. Opponents stepped aside and allowed the vote to fail under the Nebraska Constitution.

The Legislature’s 31 other conservatives, who had united with Raybould, a registered Democrat, scrambled to revive her bill. Raybould’s family operates B&R Stores, the parent company of Super Saver, Russ’s Market and other local grocery stores. Speaker John Arch of La Vista, who supported Raybould’s bill, declined to reschedule the bill until this year.

State Sen. Dave Wordekemper of Fremont, a former firefighter, was the lone Republican vote against Raybould’s bill.

Raybould said 14 and 15 year olds do not come into the workforce with a “resume full of skills” and that the point of early work experiences are to teach responsibility, time management and the “basics of showing up and doing the job.” She said allowing a lower wage could lead to more job opportunities.

“Closing the door on early employment does not prepare them for the future,” Raybould said.

Affordability And ‘Opinion Polls’

LB 258 also brings up the state’s “training wage,” a tactic meant to incentivize businesses to hire teen workers by allowing them to pay a lower wage for up to the first 90 days of a new worker’s employment. 

Raybould’s law would also address the current $5.44 training wage, a law Raybould described as “antiquated.” It is currently tied to 75% the federal minimum wage —which has stayed at $7.25 since 2009. The new law would increase the training wage to $13.50 this July, too. This wage will increase by 1.5% annually.

Sorrentino repeated what he has said in the past, that ballot measures are “flawed.” He described them as “opinion polls” that shouldn’t be used to make laws.

“I would suggest we focus on the facts and not the opinion polls,” Sorrentino said.

State Sen. Megan Hunt of Omaha, who opposed the bill, said the Legislature’s first act in 2026 will be “cutting the wages” of workers while they’re asking for help.

“Families are asking us, how are they going to keep up with prices? How are they going to keep up with the cost of living?” Hunt said. “And we’re answering by cutting their paychecks.”

This story was published by Nebraska Examiner, an editorially independent newsroom providing a hard-hitting, daily flow of news. Read the original article: https://nebraskaexaminer.com/2026/02/05/legislature-passes-law-capping-annual-minimum-wage-bumps-creating-youth-wage-below-15-until-2065/