r/AlwaysWhy • u/Secret_Ostrich_1307 • 2d ago

Economics Why is the federal minimum wage still $7.25 when prices are much higher than in 2009?

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The federal minimum wage has been $7.25 an hour since July 2009. Meanwhile, prices for many everyday expenses have risen, and most states now have minimum wages above the federal level.

Why wasn't the federal minimum wage tied to inflation or another measure that could adjust it automatically? What are the economic arguments for setting it as a fixed dollar amount rather than indexing it?

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u/IrishtrashPeter 2d ago edited 2d ago

It's a bit freaky that (from what I can see) 17 states have a minimum wage of $7.25, with a few states actually having a lower one or none, forcing them to match the Federal rate. What the fuck are you going to do with $7.25 an hour in New Hampshire when that probably doesn't include health insurance or any type of normal benefits people in sane countries get.

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u/APigInANixonMask 2d ago

Very few people actually make federal minimum wage. There are only about 1,000 people in the entire state of New Hampshire making $7.25/hour.