Minimum Wage History: Every Raise Since 1938

Minimum wage history reads like a staircase that stops mid-flight. For 71 years, Congress raised the floor every few years. Then, in 2009, it stopped. The pattern behind that stop says more than any single number.

When did the federal minimum wage start?

On October 24, 1938, when the Fair Labor Standards Act took effect and set the first federal floor at 25 cents an hour (U.S. Department of Labor). President Franklin Roosevelt signed it in June 1938, in the middle of the Great Depression. The same law set limits on weekly hours and restricted child labor. The aim was a baseline that no employer could undercut.

It covered a fraction of the workforce. Large sectors, including farm work and domestic work, fell outside it, a gap that has shaped who the wage protects ever since. Over the following decades, Congress widened coverage and raised the rate.

What is the full timeline of every raise?

Here are the major federal steps, in nominal dollars, from the Department of Labor's history of the wage:

The table lists milestone years. Congress made additional smaller increases between several of them. The last step, in July 2009, completed a three-part increase passed in 2007.

Read that chart carefully, because it flatters the system. Nominal dollars rise every decade. Purchasing power does not, which is where the story turns.

Did the minimum wage ever keep up with prices?

For a while, yes, and then no. After adjusting for inflation, the federal minimum wage peaked in 1968. The $1.60 rate of that year equals roughly $14 to $15 in today's dollars, using the Bureau of Labor Statistics consumer price index. Today's $7.25 buys about half of that.

Raises in the 1970s and 1980s slowed relative to inflation, and long gaps between them let prices run ahead. A worker in 1968 earning the minimum could support more of a household budget than a worker at the same rung today. We follow that thread in inflation vs wages and wage stagnation.

What are the longest gaps between raises?

The longest by far is the current one. The rate reached $7.25 in July 2009, which means the floor has stood still for more than seventeen years as of late 2026. Two earlier freezes came close to a decade each: 1981 to 1990, and 1997 to 2007.

Each long freeze was followed by a catch-up law. The pattern in the 2007 law was a three-step ramp, from $5.85 to $6.55 to $7.25. After the catch-up, Congress stopped. No further bill has cleared both chambers and reached a president's desk.

Why did Congress stop?

Because the incentive to act weakened. Before 1968, raises came at a steady clip. Later increases required larger fights, paired with business tax breaks or tied to other legislation. Since 2009, proposals to reach $10, $12, or $15 have stalled in committees or fallen short of the votes needed. Supporters say the wage lost too much value to defend. Opponents say a higher federal floor could cost jobs in low-cost regions and prefer that states decide. Economists disagree about the size of any job effects, and our minimum wage pros and cons post covers both sides.

States did not wait. About 30 states and D.C. now set a floor above $7.25, and a growing number index theirs to prices. Washington voters approved inflation indexing back in 1998, and the state's floor has risen with prices ever since. The latest figures are in 2026 state minimum wage increases.

What would the wage be if it had kept pace?

No single answer exists, because it depends on the yardstick. Measured against consumer prices since the 1968 peak, the figure lands around $14 to $15, as noted above. Measured against living costs in high-rent metros, the gap is larger. Measured against the MIT Living Wage Calculator's national single-adult budget of roughly $25 an hour, the federal floor covers under a third.

Housing alone tells the story. A median home now costs about five times median household income, up from two to three times in the 1980s (NAR and U.S. Census Bureau). A wage that bought a decent share of a household budget in 1968 buys a sliver now.

What carve-outs shaped the wage?

Two stand out, and both are still on the books. The first is the tipped wage, set at $2.13 in 1991, which we break down in the tipped minimum wage. The second is the subminimum wage for workers with disabilities, written into the original 1938 law and explained in the legal subminimum wage. Both show how a wage floor can carry exceptions long after the world that produced them has changed.

What does the history tell us?

It tells us that the minimum wage was never meant to be a fixed number. For three decades, it moved with the economy because Congress chose to move it. Then the choosing stopped, and the number quietly became a pay cut.

The systemic cause is design. A floor set by statute with no link to prices will lose value every year it sits, and it will recover only when lawmakers spend political effort to restore it. A rate tied to the cost of living would end that cycle. Our living wage hub shows what the gap looks like today, and the affordability data shows how much further costs have run.