Minimum Wage Thoughts

Posted: August 11, 2013 in Current Events
Tags: ,

minimum-wage-poverty

Just been thinking about the minimum wage lately.  There are some trying to push for an increase, and while I don’t think such a movement stands a chance in the current Congress, that doesn’t mean it’s not worth talking about.

  • While the current national minimum wage of $7.25 per hour, historically the minimum wage level has been pretty stagnant.  As recently as 2007, it was only $5.15 per hour.
  • As long as the minimum wage does not change (unless Congress passes a law to change it), anyone making minimum wage will in effect take a pay cut each year, because each year they will have a little less spending power.
  • As a result, the minimum wage was actually higher in years past when adjusted for inflation.  (1981 = $8.61 per hour, 1974 = $9.47 per hour, etc.)
  • While often characterized as teenager jobs, about half the people making minimum wage are 25-year-old or older.  I would imagine most of these folks are not working these jobs just for a little extra spending money.
  • Also, the fact that the minimum wage for tipped workers is still $2.13 per hour seems particularly absurd.

Now I could see some argument for whether or not the minimum wage should be a “living wage” or not.  But it would seem to me that it would not be too much to ask for the minimum wage to be restored to 1974 levels, to index it to some inflationary measure, and restore the tipped minimum wage to some reasonable percentage of full minimum wage.

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Comments
  1. List of X says:

    It’s not just the inflation – our taxes have to be higher because a lot of people making minimum wage are poor enough to be eligible for Medicare and foodstamps. In effect, the taxpayers sponsor the shareholders of Walmart, McDonalds, and other companies that pay low wages.

  2. gesvol says:

    Totally agree on that point.

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