Flagstaff, a northern Arizona city known for its ponderosa pine forests and proximity to the Grand Canyon, is set to raise its minimum wage to $18.35 starting January 1, 2026. This hike aligns with the city's commitment to adjust wages based on the cost of living, as determined by the consumer price index (CPI) from the U.S. Bureau of Labor Statistics. The numbers for August 2025, which indicated a 2.9% increase compared to the previous year, were released and utilized to calibrate the upcoming wage adjustment, as outlined in a recent announcement by the City of Flagstaff.
In a historic move, as part of this change, the city will be abolishing the previous practice of a tiered minimum wage, where tipped employees could be paid less than their non-tipped counterparts. "On and after January 1, 2026, an employer shall pay a tipped employee not less than the minimum wage set forth in this section for all hours worked," the City of Flagstaff states. This decision enforces equal pay for all workers, regardless of whether their income is supplemented by tips.
The increase stems from a voter-approved initiative on November 8, 2016. Proposition 414, known as the Minimum Wage Act, established a gradual wage increase tied to cost-of-living adjustments. Businesses and employees seeking clarity on the new minimum wage mandate can access resources and further information through the City of Flagstaff. Inquiries may be directed to Chris Rhode, Special Programs Manager, at [email protected] or 928-213-2078. Rhode can provide guidance on preparing for the changes set to take effect at the start of 2026.
