Iowa Minimum Wage 2026
Iowa's minimum wage of $7.25 in 2026 is below average in the United States, and it is the same as than the base federal minimum wage of $7.25 still used in 20 states.
Federal 
Iowa Assuming a standard 40-hour work week, the weekly minimum wage in Iowa is $290. For full-time employees working 52 weeks per year, the annual minimum wage in Iowa is $15.1K.
Based on $7.25/hr minimum
Based on $7.25/hr minimum
The minimum wage rate of Iowa and its neighboring states ranges from $7.25 to $15, with an average of $11.29. Iowa, at $7.25, has the lowest hourly minimum wage within this group of states. Missouri ($15), Nebraska ($15), South Dakota ($11.85), and Minnesota ($11.41) all have higher hourly rates than Iowa. North Dakota shares the same $7.25 hourly rate as Iowa.
Iowa While the general minimum wage is $7.25 per hour in Iowa, there are several exceptions where workers may legally receive less than this amount:
Employees earning ≥$30/month in tips. Employer pays reduced cash wage; must top up to $7.25 if tips + cash wage fall short.
Any new employee during their first 90 consecutive calendar days with an employer. Not repeatable for the same employee within 3 years.
Employees under age 20 during their first 90 consecutive calendar days of employment.
Full-time students at qualifying retail/service establishments, agriculture, or higher ed institutions (work-study); max 20 hrs/week.
Employees with physical or mental limitations that reduce their productive capacity. Requires special certificate from DOL.
Employers with annual gross sales under $300,000 that do not engage in interstate commerce are not covered by Iowa minimum wage law.
Employees whose primary duty is making sales or obtaining orders away from the employer's place of business.
Employees meeting the FLSA duties test, paid on a salary basis above the federal threshold.
Employees of federal contractors and subcontractors.
Iowa's cost of living index for 2025 is 89.7, which places it as the 45th most expensive state to live in the United States.
National 100
Iowa 89.7
Assuming a standard 40-hour work week, the real wage in Iowa, adjusted for the state’s cost of living index of 89.7, is approximately $8.08 per hour. This means that while the nominal minimum wage is $7.25 per hour, the purchasing power of those earnings is higher due to Iowa's lower cost of living expenses. For full-time employees, the real weekly earnings amount to roughly $323.30, translating to an annual purchasing power of $16,811.59 when working 52 weeks per year.
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According to the most recent data, the median household income in the United States has seen a significant increase in 2023.
Iowa’s minimum wage is established under state law at $7.25 per hour and applies to employers subject to the Iowa Minimum Wage Law. The state minimum wage aligns with the federal minimum wage under the Fair Labor Standards Act (FLSA), and Iowa law does not provide for automatic increases or inflation-based adjustments; any changes must be enacted by the state legislature.
