AdjustedMW

Chart: minimum wage in cost-of-living-adjusted dollars

Updat­ed 2021. Orig­i­nal­ly post­ed 2013

There has been a lot of talk late­ly about the min­i­mum wage and how it ought to be raised. It has been claimed that min­i­mum wage work­ers are mak­ing less now than ever and that the nation is in a crit­i­cal race to the bot­tom where work­ers on the low end of the spec­trum are get­ting squeezed hard­er and harder.

This rais­es the ques­tion of the his­tor­i­cal min­i­mum wage in the Unit­ed States. Is it real­ly low­er now than it ever has been? Did Amer­i­ca once have a min­i­mum wage that ele­vat­ed work­ers from poverty?

Specif­i­cal­ly sev­er­al posts on Face­book and oth­er sites where bad data is the norm rather than the excep­tion, the exam­ple of 1968 has been cit­ed. In the old days we did things right, or so goes the nar­ra­tive. These posts make it sound as though in the 40s, 50s, 60s, 70s and even the 80s that the min­i­mum wage was a plen­ti­ful boun­ty com­pared to the mea­ger scrap it is today.

So what is the min­i­mum wage when com­pared to the days of old and adjust­ed for infla­tion? This chart uses the data from the Depart­ment of Labor and the infla­tion cal­cu­la­tor from the Bureau of Labor Sta­tis­tics. The min­i­mum wage from each year1 was com­bined with the price infla­tion to adjust the val­ues to 20132 dollars.

The first thing that imme­di­ate­ly is appar­ent is that 1968 is an out­lier. The adjust­ed $14.193 min­i­mum wage was unprece­dent­ed and has not been seen since. So while the com­par­isons to 1968 may be entire­ly accu­rate, the 1968 num­bers ought not be con­sid­ered rep­re­sen­ta­tive of the his­to­ry of the min­i­mum wage.

It is best for this post to stick to the facts. Extrap­o­lat­ing any of this infor­ma­tion to an argu­ment for a high­er, low­er, main­tained or even elim­i­nat­ed min­i­mum wage is left as an exer­cise for the read­er. There are only two points of obser­va­tion I care to add aside from the above men­tion of 1968.

First, over the long term, the min­i­mum wage seems sta­ble. The large shifts up occurred at 1950 and 1956, and the major decline in adjust­ed min­i­mum wage occurred in the 80s while the min­i­mum wage remained sta­ble while infla­tion ate away at its val­ue. Oth­er than those tran­si­tions, it seems that the min­i­mum wage gen­er­al­ly has adjust­ed only to com­pen­sate for inflation.

Sec­ond, over the short term, the adjust­ed dol­lar val­ue of the min­i­mum wage always falls. This should not be a sur­prise. The con­stant drop of the val­ue of the dol­lar serves to erode the val­ue of the min­i­mum wage. The wage is adjust­ed upward to com­pen­sate peri­od­i­cal­ly much like prices get raised by retail­ers to com­pen­sate for the loss of val­ue in the dol­lars their prices were set in.

This appar­ent con­flict should be eas­i­ly under­stood but ought to illus­trate the caus­es for the con­flict. It is easy at any point to make the case that the min­i­mum wage is either sta­ble or falling — or even ris­ing — depend­ing on what one wants the data to illustrate.

Again, no con­clu­sions are intend­ed from the pre­sen­ta­tion of this chart. The con­ver­sa­tion about the min­i­mum wage is one with legit­i­mate argu­ments on both sides, but only if those argu­ments are made with real num­bers which are not select­ed for the pur­pos­es of sup­port­ing an argu­ment. Hope­ful­ly this data shines some light over all perspectives.

Tab­u­lar data here for your enjoy­ment: (orig­i­nal table in foot­note)4

YearMin­i­mum WageInfla­tionInfla­tion multiplierWage in 2021 dollars
1938$0.25-2.1%0.0426$5.86
1939$0.30-1.4%0.0420$7.13
1940$0.300.7%0.0423$7.08
1941$0.305%0.0445$6.73
1942$0.3010.9%0.0500$5.99
1943$0.306.1%0.0533$5.63
1944$0.301.7%0.0542$5.53
1945$0.402.3%0.0554$7.21
1946$0.408.3%0.0605$6.61
1947$0.4014.4%0.0707$5.66
1948$0.408.1%0.0769$5.20
1949$0.40-1.2%0.0760$5.26
1950$0.751.3%0.0770$9.74
1951$0.757.9%0.0836$8.97
1952$0.751.9%0.0852$8.80
1953$0.750.8%0.0859$8.73
1954$0.750.7%0.0865$8.67
1955$0.75-0.4%0.0862$8.70
1956$1.001.5%0.0875$11.43
1957$1.003.3%0.0904$11.05
1958$1.002.8%0.0931$10.74
1959$1.000.7%0.0937$10.67
1960$1.001.77%0.0954$10.48
1961$1.151.07%0.0964$11.92
1962$1.151.20%0.0976$11.78
1963$1.251.24%0.0988$12.64
1964$1.251.28%0.1001$12.48
1965$1.251.59%0.1017$12.28
1966$1.253.02%0.1049$11.91
1967$1.402.77%0.1079$12.97
1968$1.604.27%0.1127$14.19
1969$1.605.46%0.1192$13.41
1970$1.605.84%0.1266$12.63
1971$1.604.29%0.1323$12.09
1972$1.603.27%0.1368$11.69
1973$1.606.18%0.1458$10.97
1974$2.0011.05%0.1639$12.20
1975$2.109.14%0.1804$11.64
1976$2.305.74%0.1914$12.02
1977$2.306.50%0.2047$11.23
1978$2.657.63%0.2216$11.96
1979$2.9011.25%0.2497$11.61
1980$3.1013.55%0.2888$10.73
1981$3.3510.33%0.3221$10.40
1982$3.356.13%0.3432$9.76
1983$3.353.21%0.3545$9.45
1984$3.354.30%0.3705$9.04
1985$3.353.55%0.3841$8.72
1986$3.351.90%0.3915$8.55
1987$3.353.66%0.4064$8.24
1988$3.354.08%0.4237$7.91
1989$3.354.83%0.4452$7.52
1990$3.805.40%0.4706$8.07
1991$4.254.24%0.4915$8.65
1992$4.253.03%0.5068$8.38
1993$4.252.95%0.5222$8.14
1994$4.252.61%0.5362$7.92
1995$4.252.81%0.5517$7.70
1996$4.752.93%0.5684$8.36
1997$5.152.34%0.5820$8.85
1998$5.151.55%0.5912$8.71
1999$5.152.19%0.6044$8.52
2000$5.153.38%0.6256$8.23
2001$5.152.83%0.6438$8.00
2002$5.151.59%0.6542$7.87
2003$5.152.27%0.6694$7.69
2004$5.152.68%0.6878$7.49
2005$5.153.39%0.7120$7.23
2006$5.153.23%0.7357$7.00
2007$5.852.85%0.7573$7.72
2008$6.553.84%0.7876$8.32
2009$7.25-0.36%0.7847$9.24
2010$7.251.64%0.7978$9.09
2011$7.253.16%0.8239$8.80
2012$7.252.07%0.8413$8.62
2013$7.251.46%0.8537$8.49
2014$7.251.62%0.8678$8.35
2015$7.250.12%0.8688$8.34
2016$7.251.26%0.8799$8.24
2017$7.252.13%0.8991$8.06
2018$7.252.44%0.9216$7.87
2019$7.251.81%0.9386$7.72
2020$7.251.2%0.95$7.63
2021$7.255%1$7.25

  1. The year in which the min­i­mum wage was changed each year was used for the entire year regard­less of when in the year the change took place. This intro­duces some inac­cu­ra­cy to the data as for exam­ple the $1.25 min­i­mum wage for 1963 did not take effect until Sep­tem­ber of that year. Over a peri­od of decades it ought not cause much dis­tor­tion. 
  2. The orig­i­nal ver­sion of this post was based on 2013 dol­lars 
  3. Orig­i­nal ver­sion of this post said $10.74, as it was list­ing in 2013 dol­lars. 
  4. YearMin­i­mum WageAdjust­ed 2013 Dollars
    1938$0.25$4.14
    1939$0.30$5.04
    1940$0.30$5.00
    1941$0.30$4.77
    1942$0.30$4.30
    1943$0.30$4.05
    1944$0.30$3.98
    1945$0.40$5.19
    1946$0.40$4.79
    1947$0.40$4.19
    1948$0.40$3.88
    1949$0.40$3.93
    1950$0.75$7.27
    1951$0.75$6.74
    1952$0.75$6.61
    1953$0.75$6.56
    1954$0.75$6.51
    1955$0.75$6.54
    1956$1.00$8.59
    1957$1.00$8.31
    1958$1.00$8.08
    1959$1.00$8.03
    1960$1.00$7.89
    1961$1.15$8.98
    1962$1.15$8.89
    1963$1.25$9.54
    1964$1.25$9.42
    1965$1.25$9.27
    1966$1.25$9.01
    1967$1.40$9.79
    1968$1.60$10.74
    1969$1.60$10.18
    1970$1.60$9.63
    1971$1.60$9.23
    1972$1.60$8.94
    1973$1.60$8.42
    1974$2.00$9.47
    1975$2.10$9.12
    1976$2.30$9.44
    1977$2.30$8.86
    1978$2.65$9.49
    1979$2.90$9.33
    1980$3.10$8.79
    1981$3.35$8.61
    1982$3.35$8.11
    1983$3.35$7.86
    1984$3.35$7.53
    1985$3.35$7.27
    1986$3.35$7.14
    1987$3.35$6.89
    1988$3.35$6.61
    1989$3.35$6.31
    1990$3.80$6.79
    1991$4.25$7.29
    1992$4.25$7.07
    1993$4.25$6.87
    1994$4.25$6.70
    1995$4.25$6.51
    1996$4.75$7.07
    1997$5.15$7.49
    1998$5.15$7.38
    1999$5.15$7.22
    2000$5.15$6.98
    2001$5.15$6.79
    2002$5.15$6.69
    2003$5.15$6.54
    2004$5.15$6.37
    2005$5.15$6.16
    2006$5.15$5.97
    2007$5.85$6.59
    2008$6.55$7.10
    2009$7.25$7.89
    2010$7.25$7.77
    2011$7.25$7.53
    2012$7.25$7.37
    2013$7.25$7.25

2 Replies to “Chart: minimum wage in cost-of-living-adjusted dollars”

    1. Clar­i­fi­ca­tion
      You mean the Bush the younger regime. Dur­ing Bush the elder’s time in office the min­i­mum wage went from $3.35 ($6.31 in 2013 dol­lars) to $4.25 ($7.07 in 2013 dollars.)

      Although I don’t see the evi­dence for such a state­ment about Bush the younger, either. In 2001 the min­i­mum wage was $5.15 ($6.98 in 2013 dol­lars.) In 2006 that same $5.15 was only $5.97 in 2013 dol­lars, but by the end of 2008 the min­i­mum wage was $6.55 ($7.10 in 2013 dollars.) 

      I don’t sus­pect that rais­ing the min­i­mum wage was either Bush­es’ idea in any of those cas­es, but that requires infor­ma­tion out­side the scope of this data. It’s prob­a­bly more rel­e­vant that in the years in all three Bush terms when the min­i­mum wage increased that Con­gress was con­trolled by Democrats.

Leave a Reply