Federal Minimum Wage Has Not Increased in Record Amount of Time

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Minimum wage just broke another record today. It will break another tomorrow.

Did you know that the federal minimum wage has not been increased in over 12 years? Every day without an increase sets another record for the longest period of time without an increase in the federal minimum wage since the first minimum wage was enacted in 1938.

A history of the minimum wage, which was first created as part of the Fair Labor Standards Act, shows a number of incremental increases over the years. The first minimum wage was just $0.25 per hour in 1938, and it increased to $0.30 per hour in 1939, where it stayed for six years before increasing to $0.40 per hour in 1945. In 1950, the minimum wage almost doubled to $0.75 per hour. It took another six years before it increased, reaching the $1.00 per hour mark in 1956. There were four different increases in the 1960s. The period from 1974 through 1981 saw an increase in every year but one as the minimum wage stepped up gradually from $2.00 per hour in 1974 to $3.35 per hour in 1981.

After 1981, increases in the minimum wage became much rarer. In 1990, minimum wage went to $3.80 per hour, then it increased again to $4.25 per hour in 1991. It was six years until another increase, when the minimum wage was raised to $5.15 per hour in 1997.

Then there was no movement in minimum wage for a decade, which was the longest gap without an increase before the current period. Not until 2007 did it go up again, with Congress approving a gradual three-step increase, moving minimum wage to $5.85 in 2007, $6.55 in 2008 and then settling at $7.25 in 2009.

It has now been over 12 years since the federal minimum wage has increased. With this not appearing to be a priority for Congress, many states have increased their minimum wages above the federal floor. In fact, 29 states currently have minimum wages that are higher than the federal levels.

Because so many states have different minimum wages now, instead of relying upon the federal minimum wage, it is important that business owners that operate in multiple states ensure that they are complying with wage laws of each state.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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