Recent Updates

  • New project highlights teenagers struggling to find work

    Today, the Employment Policies Institute (EPI) launched a new web project featuring the stories of more than six dozen teenagers around the country who’ve been unable to find work for the summer. The stories, collected through Facebook, highlight the difficulties … Continue reading

  • The Sick Leave Fight Moves South To Texas

    Labor backed activists have collected signatures for a ballot measure that would force all San Antonio businesses to provide paid sick leave. The data shows that previous attempts to mandate paid sick leave did little to address workplace sickness, and actually hurt employees’ … Continue reading

  • July 1st Minimum Wage Increases: What You Need to Know

    On July 1st, eighteen states and locales will see mid-year minimum wage hikes. Ten cities in California alone will see minimum wage increases, despite evidence that previous minimum wage increases have decreased employment opportunities in industries with a higher percentage … Continue reading

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About the Minimum Wage

The minimum wage is the minimum hourly wage an employer can pay an employee for work. Currently, the federal minimum wage is $7.25 an hour (part of the Fair Labor Standards Act) and some states and cities have raised their minimum wage even higher than that. Washington currently has the highest state minimum wages in the country at $11.50 per hour, and Emeryville, CA, currently has the highest city minimum wage at $15.69 an hour.

Employees that earn the minimum wage tend to be young, and work in businesses that keep a few cents of each sales dollar after expenses. When the minimum wage goes up, these employers are forced to either pass costs on to consumers in the form of higher prices, or cut costs elsewhere–leading to less full-service and more customer self-service. As a result, fewer hours and jobs are available for less-skilled and less-experienced employees.

Minimum wage increases do not help reduce poverty. Award winning research looked at states that raised their minimum wage between 2003 and 2007 and found no evidence to suggest these higher minimum wages reduced poverty rates. A new study from economists at the University of California, Irvine and the National Bureau of Economic Research find that over the past 30 years, increases in the minimum wage have not reduced poverty rates in disadvantaged neighborhoods. While the few employees who earn a wage increase might benefit from a wage hike, those that lose their job are noticeably worse off.

Employees who start at the minimum wage aren’t stuck there. Research found that the majority of employees who start at the minimum wage, move to a higher wage in their first year on the job.