Economic Find: The Minimum Wage
The minimum wage provided to a worker on an hourly basis is supposed to represent the income necessary to meet basic needs such as housing, food, clothing etc. As the standard of living has become increasingly expensive over the years, one would expect to see an increase in the minimum wage as well. However, when adjusted for inflation, today’s federal minimum wage is lower than that in the 1950s and 1960s. Ever since 1968 when the federal minimum wage was highest in real value, its purchasing power has been steadily decreasing.
Despite several increases in the minimum wages by Congress in an attempt to counter the effects of inflation, today’s wage is barely enough to sustain a family. Earning $7.25 an hour in 2009, a full-time worker’s annual income amounted to around $15,000. In 2010 the workers with wages at or below the Federal minimum numbered 4.4 million people.
Based on the 2006 Field Guide to the U.S. Economy. “The Minimal Minimum Wage.” 2.3: 23.
Updated and Revised by CPE Intern Slavena Molle
Bureau of Labor Statistics, “Characteristics of Minimum Wage Workers: 2010.” http://www.bls.gov/cps/minwage2010.pdf
Department of Labor, Wage and Hour Division, http://www.dol.gov/whd/minwage/chart.htm
U.S. Census Bureau.
Gertner, Jon, “What is a Living Wage?”, The New York Times, January 15, 2006.