Minimum Wage

6018 WordsJan 17, 200225 Pages
History of the Minimum Wage · 1938 -- The minimum wage was first enacted into law as part of the Fair Labor Standards Act (FLSA) of 1938. The original minimum wage applied to workers engaged in interstate commerce and the production of goods for interstate commerce. In 1938, this applied to roughly 11.0 million workers out of a total of 54.9 million workers. The minimum wage was set at $0.25 per hour. · 1961 -- Amendments to the minimum wage law extend coverage primarily to employees in large retail and service trades as well as local transit, construction, and gasoline service station employees. · 1966 -- Amendments to the minimum wage law extend coverage to state and local government employees of hospitals, nursing homes, and…show more content…
Many economists believe that the minimum wage raises the wages of middle-class teens while doing little to help the working poor get out of poverty. Edward Gramlich (1976) found that any income gains among teenagers resulting from the minimum wage are about evenly split between high-income and low-income families. The vast majority of minimum wage workers are not the primary wage earner in a poor family; Richard Burkhauser and T. Aldrich Finegan (1989) estimated that in the mid-1980s only 7 percent of low-wage workers were heads of families living in poverty. Burkhauser, Kenneth Couch and David Wittenberg (1996) found that almost 40 percent of all workers directly affected by the minimum wage increases in 1990 and 1991 were from families in the top half of the income distribution, with 4 percent of affected workers in the top decile. The minimum wage does have the potential to raise the incomes of some poor households, particularly those headed by women. About 40 percent of poor adults worked in 1994, and low-wage workers contribute about one-half of household earnings. Over one-fourth of all workers in the lowest family income decile were affected by the 1990 and 1991 federal minimum wage increases, according to Burkhauser, Couch and Wittenberg. Because women tend to have lower earnings than men, working women are more likely to be in poverty. In 1987, the earnings of nearly 18 percent of working female household

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