By Holly Sklar
People who work for a living need to be able to make a living. Raising the minimum wage is a vital part of the solution to the affordability crisis.
The cost of food, housing, healthcare, transportation and other necessities has risen sharply. But the federal minimum wage has been stuck at $7.25 since 2009, the longest period in history without a raise by far. That’s 17 years with the same minimum wage, but a much higher cost of living.
Full-time work at $7.25 an hour amounts to just $15,080 if you are paid for 40 hours a week, 52 weeks a year.
Raising the federal minimum wage would boost wages from the bottom up. Instead, the growing gap between the minimum wage and the cost of living is keeping millions of workers in poverty at the minimum wage and above it.
A red light for minimum wage is a green light for increasing inequality.
Workers’ share of national income is at record lows while corporate profits are at record highs.
While the federal minimum wage has stayed at $7.25 since 2009, the number of U.S. billionaires has swelled from 357 to 989 – and 15 of them have a net worth of more than $100 billion each.
The federal minimum wage peaked in buying power way back in 1968, when it was worth $15.62 in 2026 dollars, according to the U.S. Bureau of Labor Statistics Inflation Calculator. Millions of workers make less than that today, or just a little above it.
Nationally, more than 12 million workers make less than $15 per hour, 18 million workers make less than $16, and 23 million make less than $17, including overtime, tips and commissions, according to the Economic Policy Institute’s Low Wage Workforce Tracker.
Twenty states have minimum wages no higher than the $7.25 federal level: Alabama, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Wisconsin and Wyoming.
Five of those states – Alabama, Louisiana, Mississippi, South Carolina and Tennessee – don’t have a state minimum wage and in Georgia and Wyoming the state minimum is $5.15, so the federal $7.25 minimum wage applies.
The minimum wage matters for workers making the minimum and it matters for workers making more than the minimum, but still not earning enough to make ends meet.
In states where the $7.25 minimum wage applies, the share of workers making less than $15 an hour – including overtime, tips and commissions – is high: 25% of workers in Mississippi, 22% in Oklahoma, 20% in Louisiana, 16% in Texas, 15% in Alabama, 14% in Kentucky and South Carolina, and 12% in North Carolina, Georgia and Kansas, for example.
The median wage is the midpoint in wage distribution. The median hourly wage for childcare workers in 2025 was just $10.60 in Mississippi and $10.92 in Alabama, for example. The median wage for home health and personal care aides was $10.83 in Louisiana and $11.65 in Texas. The median wage for short order cooks was $9.57 in Pennsylvania and $10.55 in Indiana. Half of those workers earn less than those median wages.
Raising the minimum wage will help workers keep up with the cost of living and bolster the consumer spending that businesses and the economy depend on.
It’s important to remember that workers are also customers.
Raising the minimum wage is a very efficient way to boost small businesses and the economy because it puts more money in the pockets of people who most need to spend it.
Fairer pay also helps businesses by reducing costly employee turnover and improving productivity and customer service.
Employees often make the difference between repeat customers and lost customers.
Decades of rigorous research of actual minimum wage increases show that raising the minimum wage is beneficial and does not cause job loss.
There’s nothing radical about a decent minimum wage. As Adam Smith, the “father of modern capitalism,” put it in 1776, “It is but equity, besides, that they who feed, clothe and lodge the whole body of the people, should have such a share of the produce of their own labor as to be themselves tolerably well fed, clothed and lodged.”
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Holly Sklar is the CEO of Business for a Fair Minimum Wage, a national network of business owners and executives who believe fair pay makes good business sense. www.businessforafairminimumwage.org
