The value of the federal minimum wage is at its lowest level in 66 years.

The federal minimum wage hit its lowest level in 66 years, according to EPI’s analysis of recently released consumer price index (CPI) data. With price increases in June, the current federal minimum wage of $7.25 an hour is now worth less than at any time since February 1956. At the time, the federal minimum wage was 75 cents an hour, or $7.19 in June 2022 dollars. .

July was the longest period no increase in the minimum wage since Congress established the federal minimum wage in 1938, and continued inaction on the federal minimum wage over the past year has only further eroded the value of the minimum wage. As shown in Figure Aa worker paying the current federal minimum wage of $7.25 earns 27.4% less inflation-adjusted than what a colleague earned in July 2009 when the minimum wage was last raised, and 40.2% less than the minimum wage worker in February 1968. historical maximum value of the minimum wage.

The increase in the minimum wage in the late 1960s expanded the scope of the minimum wage to include industries such as agriculture, nursing homes, restaurants, and other service industries. The earlier exemption of these industries from the federal minimum wage disproportionately excluded black workers from this important labor protection. Applying the minimum wage to these industries raised income of employees and directly reduced income inequality between blacks and whites. However, the failure of Congress to regularly raise the minimum wage during the interim period undermined the value of the federal minimum wage and widened the income gap between races.

After the longest period without a raise in history, the federal minimum wage is now worth 27% less than it was 13 years ago and 40% less than it was in 1968.: The real value of the minimum wage (adjusted for inflation)

Note: All June 2022 dollar values ​​adjusted using CPI-U in 2022 are linked to CPI-U-RS (1978-2021), CPI-U-X1 (1967-1977) and CPI -U (1966 and earlier).

Source: Fair Labor Standards Act and Amendments.

As Congress continues to be inactive on the minimum wage, 30 states and nearly 50 cities and counties introduced an increased minimum wage. This includes 12 states and the District of Columbia that have adopted minimum wages of $15 or higher. More recently, Hawaiian lawmakers elected to raise their state’s minimum wage to $18 by 2028, and politicians in New York is considering a proposal to raise the minimum wage to $20 an hour. in New York, and the minimum wage is a few dollars lower in the rest of the state.

$15 National Minimum Wage Will Boost Revenues tens of millions workers, including waiters in restaurants, grocery store employees and essential healthcare workers, as much as 2 million direct care workers who provide long-term services and support will receive a $15 minimum wage in 2025. While the Biden-Harris administration has recently raised minimum wage to $15 an hour for federal contractors, it is long overdue to raise the minimum wage for all workers.