California’s minimum wage is set to soon become the highest of any state in the nation, following the approval of a bill that would raise the state minimum wage by $2 by 2016.

The state Assembly bill, which passed both houses of the California Legislature Thursday night and is expected to be signed into law by Gov. Jerry Brown, would raise the state minimum wage to $9 per hour in July 2014 and to $10 per hour in January 2016. California’s minimum wage has been unchanged since it was set at $8 per hour in 2008.

“This is a giant victory,” said Councilmember Kriss Worthington, who, along with Mayor Tom Bates and Councilmember Jesse Arreguin, drafted a statement in April urging the city’s Commission on Labor to consider implementing a citywide minimum wage of $10.55 per hour.

The commission has been discussing plans to raise Berkeley’s minimum wage since May. The state bill sets a “bare-minimum baseline,” said Angus Teter, chair of the commission’s minimum wage subcommittee, but the commission still intends to create a higher city minimum wage that would reflect the cost of living in Berkeley.

While Berkeley has no mandated city minimum wage at the moment, it does have a Living Wage Ordinance, which currently requires businesses contracted under the city to pay their employees at least $13.34 per hour plus a medical benefit of at least $2.22 per hour.

“Even getting paid 25 or 50 cents more is so much of a difference … (especially for) some of my co-workers,” said UC Berkeley sophomore Hannah Kim, who makes minimum wage at her waitressing job in Berkeley. “Minimum wage is what they live off of.”

According to Sylvia Allegretto, co-chair of the UC Berkeley Center on Wage and Employment Dynamics, the statewide increase is a “fairly modest” one, as low-wage workers in California are currently making less than they would have been 30 years ago, after inflation is factored in. Furthermore, the raised minimum wage may actually benefit restaurants by reducing employee turnover, Allegretto said.

However, Todd Kniess, chef and owner of Bistro Liaison, said that an increase in minimum wage will result in possible layoffs and reduced hours for his restaurant. Kniess believes that the minimum wage law should allow employers to pay tipped workers at a rate lower than minimum wage.

“The servers in the front who make minimum wage actually make more than $25 or $35 an hour here,” Kniess said. “There’s no incentive for people to be entrepreneurs and hire people anymore.”

For Robert Gaustad, co-owner of Bobby G’s Pizzeria, the new state mandate is manageable — but if the city does increase the minimum wage to more than $10 an hour, it would make running his business even more difficult.

“The restaurant industry is a low-profit-margin business,” Gaustad said. “Federal, state and local governments sometimes seem to think we have unlimited budgets. They couldn’t be more wrong.”