3rd Recommendation - About the Minimum Wage

A lot of the recommendations I have (and will) make about the economy are about the behavior of the financial sector and how it sucks money away from the "real economy" or how corporations (mostly large and with international affairs) direct money away from investments which could be profitable and employ workers or away from higher wages & compensation for employees.

To overcome that the government has often raised the federal minimum wage to ensure sufficient money goes into the pockets of the working poor (and some just above that). I don't always think that's the perfect solution because it also affects much smaller businesses which cannot manage sudden changes to their labor costs.

Today we are at a place, after some years of business growth, where I believe we should be able to increase the federal minimum wage. The federal minimum wage was last changed July 24th, 2009 to $7.25 per hour. Many states have already raised their minimum wage above the federal level, so it won't be a shock to them at all.

These are the states with a higher state minimum wage than the federal.

Axios did an article on state minimum wages. The main takeaway from the article is that the minimum wages (both state and federal) are too low.

For a bit of recent history of our federal minimum wage, take a look at this U.S. Dept. of Labor article on the minimum wage.

There are about 30 states which have a state minimum wage higher than the federal, there are about 15 states which have the same rate as the federal, there are 5 states with no state-wide minimum wage, and there are 2 states with lower state minimum wage rates (of course, companies there are required to pay the higher federal minimum wage rate).


These are the states with the same state minimum wage as the federal:

What should the new level be? Of states with a minimum wage rate higher than the federal government, there are a few with greater than $10.00, but most are in the $8.25 -- $9.65 range. I would suggest a new rate should be in the lower third of that, perhaps $8.50 per hour. That would give pay raises to people in about 25 states (1/2 of our states).