Thread by @JECDems

The failure of the U.S. government to increase the federal minimum wage to keep pace with or exceed inflation has left many American families without a path to the middle class.

Check out part one of three @JECDems issue briefs on the eroding value of the minimum wage here ⤵️

Some key points from the first installment 👇

A full-time worker making the minimum wage today lives in poverty—earning just $15,000 annually, a drop of more than $6,000 when compared to more than 50 years ago.

The federal minimum wage in 1968 was $1.60 per hour – the equivalent of just over $10 per hour today. Yet the current federal minimum wage is $7.25.

A full-time worker making $1.60 per hour in 1968 would bring home approximately $3,300 per year, which amounts to more than $21,000 annually in today’s dollars.

Despite small increases over the years, today’s minimum wage has lost more than 30% of its real value since its 1968 peak. A full-time, year-round worker earning the minimum wage in 2021 brings home only about $15,000 annually.

The current federal minimum wage leaves full-time, year-round minimum wage workers and their families far below the poverty line. A single full-time worker at the minimum wage earns almost $7,000 less per year than the poverty threshold for a family of three ($21,960).

The economy has grown dramatically over the last 50 years. Productivity has nearly doubled since the late 1960s. While the top 1% of wage earners saw their average annual wages grow by more than 160% in the past 40 years, the wages of the bottom 90% have only grown by about 26%.

In 1968, the minimum wage was slightly above 1/2 the median wage of all full-time workers. Today, it stands at about 1/3 of the median wage. Minimum wage workers fare much better in other OECD countries, where the average national minimum wage is more than half the median wage.