Economic Snapshot | Wages, Incomes, and Wealth

A Stagnating Minimum Wage has Left Low-Wage Workers Facing a Longer Climb to Reach The Middle Class

Over the past 46 years, as lawmakers have failed to adequately raise the federal minimum wage, the gap between wages of the average U.S. worker and the lowest-paid worker has grown substantially. In fact, the declining inflation-adjusted value of the minimum wage is the main cause of growth in wage inequality between low-wage workers and middle-wage workers since 1979, particularly among women.

The figure below shows the value of the minimum wage as a percentage of the average hourly wage of nonsupervisory production workers—a category that comprises 80 percent of all workers in the United States, and excludes highly-paid managers and executives. As shown in the figure, at its high point in the late 1960s, the minimum wage was equal to 53 percent of the average wage. Yet after 46 years of infrequent or inadequate increases, today’s minimum wage is equal to only 35 percent of the average production worker’s wage—not far from its lowest point on record.

Economic Snapshot

A stagnating minimum wage has led to increased wage inequality: Federal minimum wage as a percentage of the average U.S. production worker wage, 1964–2014

Minimum wage as a percentage of average wage  
1964 49.4% 50%
1965 47.6%
1966 45.7%
1967 49.1%
1968 53.0%
1969 49.8%
1970 47.0%
1971 44.1%
1972 41.0%
1973 38.7%
1974 45.1%
1975 44.4%
1976 45.4%
1977 42.3%
1978 45.1%
1979 45.7%
1980 45.3%
1981 45.0%
1982 42.6%
1983 40.9%
1984 39.5%
1985 38.3%
1986 37.5%
1987 36.7%
1988 35.5%
1989 34.2%
1990 37.3%
1991 40.4%
1992 39.5%
1993 38.5%
1994 37.5%
1995 36.5%
1996 39.5%
1997 41.2%
1998 39.6%
1999 38.2%
2000 36.7%
2001 35.4%
2002 34.4%
2003 33.5%
2004 32.8%
2005 32.0%
2006 30.8%
2007 33.6%
2008 36.3%
2009 39.0%
2010 38.1%
2011 37.3%
2012 36.7%
2013 36.0%
2014 35.2%  50%
ChartData Download data

The data below can be saved or copied directly into Excel.

Source: Author’s analysis of Current Employment Statistics survey data from the Bureau of Labor Statistics and the Fair Labor Standards Act and amendments

Copy the code below to embed this chart on your website.

 


See related work on Wages, Incomes, and Wealth

See more work by David Cooper