The House of Representatives is expected to vote today on the “Raise the Wage Act” backed by Democrats. It would raise the federal minimum wage in stages from the current $7.25 per hour set in 2009 to $15 per hour by 2025. A federal minimum wage hike is not expected to be taken up by the Republican-controlled Senate.
With the federal minimum wage stagnant for the past ten years, 29 states and the District of Columbia have set their own, higher minimum wages, ranging as high as $14 per hour in D.C., and creating a complicated nationwide patchwork of wage structures for workers and employers. Seventeen states, meanwhile, have preempted the need for periodic legislative action to update their minimum wage, by indexing it to inflation, so the wage automatically increases to maintain its purchasing power as prices rise.
The current federal minimum wage of $7.25 per hour has lost close to 15% of its value since it was last raised in 2009 after adjusting for inflation, according to an analysis by the Economic Policy Institute. The value of the federal minimum wage peaked in 1968; if it had kept up with inflation since then, it would be set at $10.15 per hour today, according to a report by the Congressional Joint Economic Committee.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.