What It Is
Minimum wage is the smallest hourly wage that employers can pay employees under federal law. It varies from state to state, as some states adopt minimum wages that are higher than the federal wage. However, as the name implies, the federal minimum wage is the absolute lowest hourly wage a state can adopt.
As of July 24, 2009, the federal minimum wage is $7.25 an hour. A list of the present state minimum wages can be found here.
Why It Matters
Many believe that the minimum wage does not provide a sufficient standard of living and quality of life. The federal minimum wage would need to be raised to $8.20 an hour simply to meet the federal poverty level. In many higher-cost regions, the wage needed to meet poverty levels is substantially higher (up to $18 per hour).
Higher wages can
- Increase consumer purchasing power
- Reduce costly employee turnover
- Raise productivity
- Improve product quality
- Improve customer satisfaction
Resources
- This interactive map shows the minimum wages for each state.
- The Economic Policy Institute has published an issue guide on minimum wage that includes facts about the minimum wage and frequently asked questions.
Glossary of Related Terms
Professional Development: The skills required for maintaining a specific career path or enhancing skills through continuing education and personal development; this includes training to keep current with changing technology, practices within a profession, or the concept of lifelong learning.
Quality of Life: Quality of life research often distinguishes between subjective and objective quality of life. Subjective quality of life is about feeling good and satisfied. Objective quality of life is about fulfilling the societal and cultural demands for material wealth, social status and physical well-being.
Standard of Living: A measure of economic well-being based on a person’s ability to buy the goods and services he/she desires.
State Minimum Wage: As of July 24, 2009 the federal minimum wage is $7.25 an hour. State minimum wages may differ. Some localities require that employees be paid a living wage.
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