PIERRE — The South Dakota minimum wage will increase from $9.30/hour to $9.45/hour effective Jan. 1, 2021.

The minimum wage is annually adjusted by any increase in the cost of living, as measured in the Consumer Price Index published by the U.S. Department of Labor. This year’s increase was 1.3% and is rounded up to the nearest 5 cents. The new adjusted rate for South Dakota employees is announced for the following year annually by Oct. 15. The state's minimum wage cannot be decreased.

The hourly minimum wage for tipped employees will be $4.725/hour effective Jan. 1, 2021, half the minimum wage for non-tipped employees. Wages and tips combined must equal at least the minimum wage.

South Dakota has had its minimum wage annually adjusted for inflation since a 2014 ballot measure passed a vote of South Dakota voters, raising the minimum wage from $7.25 an hour to $8.50, starting in 2015.

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