SAN JUAN, Puerto Rico (AP) — Puerto Rico’s governor signed a bill Tuesday to increase the U.S. territory’s minimum wage for the first time in more than 12 years.

The current minimum pay of $7.25 an hour will increase to $8.50 in January and to $9.50 in July 2023. A third increase to $10.50 is contemplated for July 2024, but would require further approval.

Gov. Pedro Pierluisi said the first increase could represent an additional $2,000 a year for a full-time worker.

Many cheered the move, given the high cost of living on an island struggling to emerge from a deep economic slump as it restructures a portion of its more than $70 billion public debt via a bankruptcy-like process.