Yes, the minimum wage has been keeping pace with inflation for decades, and years since it has not increased
Efforts to raise the minimum wage may have stalled at the federal and state levels, but pressure for an increase continued.
President Joe Biden’s plan for an increase in the federal minimum wage was passed by the United States House earlier this year, but was crushed in the Senate. In Wisconsin, meanwhile, Republicans quickly stripped of the state budget Democratic Governor Tony Evers’ proposal to increase the minimum wage from $ 7.25 an hour to $ 8.60 this year and then to $ 10.15 in 2024.
Critics say rising labor costs get companies to downsize or hire fewer people. Supporters of the minimum wage increase argue the move would lift millions of Americans out of poverty.
One such supporter is Wisconsin Lieutenant Governor Mandela Barnes, who recently responded on Twitter to Republican U.S. Senator Ron Johnson’s comments about wages rising too much and too quickly.
Barnes, who is planning a race against Johnson in 2022, said the senator was correct that some salaries were rising too quickly – those of CEOs across the country, who he said far exceeded salary increases for the average worker . (We have assessed this statement to be true.)
Barnes also highlighted the evolution of the federal minimum wage over the years.
“For anyone who lives in fear of the myth of wages rising too quickly, it’s been over 50 years since the minimum (wage) and inflation separated, then more than a decade since the federal minimum did. has not increased at all “, Barnes tweeted on May 23, 2021.
Is he right about this?
We will take a look.
It’s been a long time since the minimum wage rose at the same rate as inflation – and not at all
We are going to eliminate the simpler part of the claim first. When was the last federal minimum wage increase?
Chet Agni, director of communications in the office of the lieutenant governor, quoted the Fair Minimum Wage Act 2007, which Congress passed that year to raise the minimum wage to $ 7.25 an hour over a two-year period.
The federal minimum wage is still $ 7.25 an hour, according to the US Department of Labor, so Barnes is one of the money for that part of the claim.
Here, of course, he’s talking about gross dollars – or what’s called the nominal minimum wage. It’s a little different from what Barnes talks about when he says it’s been 50 years since minimum wage and inflation separated.
But what about this part of the claim?
Let’s start by clarifying what he meant by “separate tracks”. Agni said Barnes was referring to when the minimum wage stopped rising to keep pace with inflation.
He cited a Forbes play title from February 2021 “What you need to know about the minimum wage debate.” Throughout the 1940s to the 1960s, minimum wage increases generally kept pace with inflation, the article says, but wage growth began to slow after 1968 and lagged behind pace. inflation.
The article refers to a Economic Snapshot for June 2019 from the left-wing Economic Policy Institute, which says the federal minimum wage has lost 31% of its purchasing power since 1968, when it peaked.
In one Indexation and Federal Minimum Wage Report 2016 from the non-partisan congressional research service, one can visually see inflation and the minimum wage. (Indexation adjusts the price or value of something for inflation.)
In a graph using data from the US Department of Labor and the Bureau of Labor Statistics, two lines representing the nominal minimum wage, or the rate at which employees were paid at the time, and the inflation-adjusted minimum wage initially increase together.
The nominal minimum wage was set at 25 cents an hour under the Fair Labor Standards Act of 1938. Using the Bureau of Labor Statistics inflation calculator, it can be determined that it was 4, $ 31 in 2016 dollars.
Until 1968, the two lines went up together. As inflation rises, so does the minimum wage. However, after 1968, the inflation-adjusted value of the minimum wage begins to decline, although the nominal minimum wage – the amount in gross dollars – continues to rise.
The inflation-adjusted minimum wage experienced its sharpest fall during the 1980s, according to the report, while the nominal minimum wage increased once in 1980 and again in 1981.
Barnes said it had been more than 50 years since the federal minimum wage had stopped rising at the same rate as inflation, and that it had been more than a decade since the minimum wage had increased.
The inflation-adjusted minimum wage and the nominal minimum wage stopped increasing together after 1968, 53 years ago. And the federal minimum wage was last increased in 2009.
We rate his request True.