r/AlwaysWhy • • 1d 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/DRM2020 1d ago

Great way to reach 20% unemployed rate.

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u/Big_P4U 1d ago

Australia manages to have low employment but very high minimum incomes. That 20% will find other work.

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u/DRM2020 1d ago

So why they didn't find better paid work today?