Republicans, who fought unsuccessfully to reduce the size of the increase, said the bill now faces a certain veto.
The measure would raise the state minimum wage from $7.50 to $8.50 an hour, highest in the region.
House Democrats reworked the bill during floor debate to exempt businesses with 10 or fewer employees from paying the higher wage. They also set a six-month training wage of $7.50 an hour for inexperienced workers.
The bill carried 37-32 with Republicans opposing it. In the last day of the legislative session the measure must go back to the Senate for concurrence on the amendments. Senators previously approved a similar minimum wage bill on a 25-17 party-line vote.
Rep. Nate Gentry, R-Albuquerque, said the bill was doomed because Republican Gov. Susana Martinez would veto it.
Gentry tried to amend the bill to a 30-cent increase, to $7.80 an hour. He said Martinez would sign into law the more modest increase he proposed, but the $1 jump starting in 2014 was unacceptable to her.
A 30-cent raise is better than no raise, Gentry said in asking Democrats to accept his proposal. They rejected it.
Rep. Eliseo Alcon, D-Milan, also fired a retort at Gentry.
"The last thing I have to worry about is the governor," Alcon said.
Legislators, Alcon said, need to be worried about the working poor. He said Gentry's call for a 30-cent increase "is a way to tell the people of New Mexico that we don't care for them."
Sen. Bill Soules, D-Las Cruces, cosponsored the bill, which started in the Senate. Soules said the $1-an-hour increase would give the poorest families an extra $40 a week that they would pour right back into the economy with purchases of food, electricity and gasoline.
"I hope the governor will do the right thing for the people," Soules said in an interview. "...If she chooses to play more politics, then that's her role as governor."
House Republicans said the wage increase would hurt businesses and restrict job opportunities.
Rep. Monica Youngblood, R-Albuquerque, read a letter from a child-care business in Alamogordo. Youngblood said the wage increase would cost the nonprofit operation another $90,000 a year — an increase it cannot afford.
A counterargument came from Rep. Phillip Archuleta, D-Las Cruces. He said consumer expenses keep going up, both in cities and in rural areas, making life harder for those on the bottom of the pay scale. Yet when a minimum-wage increase is proposed, the opposition tries to scare the public by saying it will drive up prices that go up anyway, Archuleta said.
The minimum wage increase is Senate Bill 416.