minimum wage in usa

The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA). Some state laws provide greater employee protections; employers must comply with both. If the federal and local government minimum wages are different, the higher wage rate applies.

  • The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA).
  • “I was surprised at how little, or how difficult it was to find disemployment effects.
  • “Many of the California [quick-service restaurant] urban locations are already paying $19 and $20,” he said.
  • To opponents, it is a cataclysmic move that will raise food prices, lead to job losses and force some franchisees to consider closing.
  • The table below lists the current prevailing 2024 minimum wage rates for every state in the United States.
  • The default policy option in this interactive tool is based on the Raise the Wage Act of 2023 (S. 2488), which CBO analyzed in The Budgetary and Economic Effects of S.

Less than 1% of hourly workers older than 35 years old earn the minimum wage. State Minimum Wage LawsA clickable map that tells you what the minimum wage laws are in each state. The Department of Labor’s Wage and Hour Division administers and enforces the federal minimum wage law. minimum wages The amount of tips plus the $2.13 must reach at least $7.25 per hour. The minimum wage increased to $14.00 on July 1, 2022, and $15.00 on June 1, 2023. Like many business owners, Perez has to consider how inflation affects both her company’s labor costs and her clients’ budgets.

Inflation indexing

“If they cannot get on the ladder because the minimum wage cuts off the first rung, they may be prevented from climbing their way up the ladder to bigger and better jobs,” the organization testified in 2021. Those increases, which benefit roughly 8.4 million Americans, ranged from 23 cents in Michigan to $1.50 in Nebraska. As noted above, the agency updated its method for calculating employment elasticities for its December 2023 report The Budgetary and Economic Effects of S. For details of CBO’s analysis, see Appendix A of CBO’s July 2019 report The Effects on Employment and Family Income of Increasing the Federal Minimum Wage. CBO updated the method it uses to calculate the responsiveness of employment to changes in the minimum wage, which is represented by elasticities.

minimum wage in usa

In major metropolitan areas, the gap between prior pay rates and the new minimum wage is likely smaller. The law won’t directly touch other restaurants in California — small coffee chains, mom-and-pop diners and upscale steakhouses — but they still could have to adjust their pay as they compete for the same employees. And industries that rely on hourly workers, such as retail and hospitality, may also face pressure to match their wages or risk losing their employees. Over the past decade, California has doubled its minimum wage for most workers to $16 per hour. A big concern over that time was whether the increase would cause some workers to lose their jobs as employers’ expenses increased. When your business is based in one state and employs remote workers in another, the minimum wage laws of the state where the employee is physically working usually apply.

Income inequality

A tip credit is the amount of tips earned by a worker that they are allowed to “credit” against the minimum wage for their sector. This minimum wage will vary depending on your industry, role, location of employment and other factors. This means that a tipped employee in Hawaii needs to earn at least $21 per hour, including a minimum of $12.75 in direct wages, to qualify for this credit.