Is the proposed $15 an hour federal minimum wage too much or too little? This past weekend, as I contemplated over 15 months of social distancing, I was cleaning out old files and found a pay stub from my college days in 1974. Yes, I am a Boomer, so please don’t hold it against me. I looked and I was making $2.60 an hour working for my local school district. I started to wonder what this amounted to in 2021 dollars and how close to minimum wage it was. I had no real skills at that time, only that I worked hard, showed up on time and did what I was asked to do. This process drove me to write this post. Many respected sources are saying $15 will eliminate many entry level jobs. Let me tell you what I discovered.
First, to provide some background, the minimum wage was put into place by President Roosevelt as part of the Fair Labor Standards Act of 1938. This was one piece of his New Deal legislation for Americans. At the time, the law set the minimum wage at 25 cents an hour. Roosevelt intended this rate to be “more than a bare subsistence level.” The minimum wage was created expressly to ensure that people of all skill-levels, if they worked, could "earn a decent living” from those wages—thus, a living wage. Today the federal minimum wage is $7.25 and has not been raised since July 2009.
Today’s Money
I found that the $2.60 an hour I was making in 1974 equates to $13.21 in today’s purchasing power. This money, along with another job I had, enabled me to pay for over 50% of my tuition and living costs to attend a private college where I was a commuter student.
Comparisons to Other Workers
I did some further research and found a February 20, 2020 report titled State of Working America Wages 2019 by the Economic Policy Institute that got my attention. This publication reported that the median wage for all workers in 2019 was $19.33 per hour or about $40,000 per year with 1% wage growth in the last year. That means that 50% of American workers made less than this amount. In fact, the report showed that 30% of Americans made less than $14.64 an hour in 2019. Overall, this shows that the effort to raise the minimum wage is designed to help the lower earning cohort have a basic living wage.
My Thoughts
The $2.60 per hour I was paid in 1974 enabled me to pay for a good share of my college costs without having to take on more student loans. I did not have a family to support or other dependents. I was just trying to pay for my education. It appears very clear to me that the federal government is behind in adjusting the minimum wage to keep up with inflation alone. The time is right to reconsider this valuable protection for many workers.
What do you think? Is the proposed $15 a hour wage too much or not enough? Please leave us a comment to let us know.
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