July 24, 2025—July 24 marks sixteen years without a federal minimum wage increase, the longest period by far without a raise since the federal minimum wage was enacted in 1938. The $7.25 hourly federal minimum wage amounts to just $15,080 a year for full-time workers. Business owners in states still at the $7.25 minimum wage say it is depressing consumer spending and bad for business and the economy.
Businesses depend on the buying power of their customers, and the buying power of the minimum wage has decreased greatly in recent decades, adjusted for the rising cost of living. Business owners point to increased consumer spending, lower employee turnover, and improved productivity and customer service among reasons they support raising the wage floor.
The federal minimum wage peaked in purchasing power in 1968, when the minimum wage was worth $15.09 in 2025 dollars, according to the U.S. Bureau of Labor Statistics CPI Inflation Calculator. Thirty states now have minimum wages that are higher than $7.25, but many of them are still below the value of the federal minimum wage in 1968, adjusted for the cost of living.
“The minimum wage was intended to be an anti-poverty wage, not a poverty wage,” said Holly Sklar, CEO of Business for a Fair Minimum Wage. “It used to rise along with worker productivity. But things have gone from bad to worse. After minimum wage increases that were too little, too late, we’re now at 16 years with no raise at all. As the cost of living rises, there’s a growing gap between minimum wage and what people need to live on. Raising the minimum wage is good for business as well as workers. Workers are also customers and minimum wage increases put money in the pockets of people who most need to spend it – boosting local businesses and communities.”
Eric Henry, CEO of TS Designs in Burlington, North Carolina: “As someone who has been in domestic apparel manufacturing for more than 40 years, I know firsthand that investing in people is the best investment a business can make. We’ve built our success on fair pay and a complete Dirt to Shirt made-in-the-USA supply chain, starting with the farmers growing the cotton. Raising the minimum wage will strengthen the workforce in North Carolina and across our country. And it will boost the consumer spending that allows businesses to survive and thrive – from local farms to stores to manufacturers.”
Adam Orman, co-owner of L’Oca d’Oro and Bambino Restaurants in Austin, Texas: “Now more than ever, we need to raise the minimum wage and phase out the discriminatory tipped minimum wage so hospitality workers can count on fair, secure pay and live with dignity. When employees are paid fairly, they are happier and more productive and take better care of customers. They can afford to live in the cities where they work. And when workers get raises because of minimum wage increases they have more to spend at local businesses as customers.”
Peter Barber, CEO of Two Dudes Painting Company in Lancaster, Pennsylvania: “Our commitment to fair wages has powered the success of Two Dudes for going on 40 years. Because we take care of our employees, they stay with us longer, provide top-notch customer service, and help our business grow and thrive. We spend less money and time on hiring and training, and our employees get better the longer they stay with us. Investing in them is investing in the business. It’s past time to raise Pennsylvania’s minimum wage.”
Rebecca Hamilton, co-owner of W.S. Badger Company in Gilsum, New Hampshire: “A $7.25 minimum wage is bad for New Hampshire’s people and economy. We’ve been able to hire and retain great employees at Badger because people know that we provide good wages and wide-ranging benefits, and encourage work/life balance. But the minimum wage needs to be increased so all workers can make a living, businesses have a stronger customer base, and there is more money circulating in local communities.”
Mike Draper, owner of RAYGUN clothing and design, with locations in Des Moines, Ames, Cedar Rapids, Cedar Falls, Davenport and Iowa City, Iowa, as well as in Missouri, Illinois and Nebraska, and a future location in Madison, Wisconsin opening in September: “When the federal minimum wage was last raised in 2009, RAYGUN was a small shirt shop in Des Moines and I was the sole employee. My oldest child is now the same age as the 16-year-old federal minimum wage and my wife and I have three other kids. RAYGUN has grown to an 11-store-operation with 120 employees across five states – with more on the way. Without our commitment to fair pay and great customer service, none of that growth would have been possible. Our better wages and benefits have led to lower turnover and happier employees and customers. Everyone needs a fair wage whether they work for RAYGUN or anyone else. And local businesses can benefit greatly from the boost in consumer spending that comes with raising the minimum wage.”
Camille Moran, owner of 4 Seasons Christmas Tree and Plant Farm in Natchitoches, Louisiana: “The long outdated $7.25 minimum wage is a poverty wage in Louisiana and everywhere else. It’s a drag on the pay scale so that many workers earning above the minimum wage still struggle to afford food, housing and other necessities. I pay higher wages so my employees can make ends meet and concentrate on delivering good production and the service that keeps our customers happy. The cost of living has risen greatly since the last minimum wage increase. Raising the minimum wage will put more money in the pockets of the customers of local businesses throughout Louisiana and across our nation.”
Johnny Martinez, co-owner of Joystick Gamebar and Mambo Zombi in Atlanta, Georgia: “The federal minimum wage has been stuck at $7.25 since 2009, and every year it falls further behind the cost of living. People can’t afford rent, groceries or even a night out to unwind, which directly hurts small businesses like mine. If we want local economies to thrive, we need to put more money in people’s pockets. Raising the minimum wage isn’t just the right thing to do, it’s good business.”
Steven Dyme, CEO of Flowers for Dreams, with locations in Milwaukee, Wisconsin as well as Chicago and Detroit: “It’s shameful that the federal minimum wage has been $7.25 an hour for 16 years and Wisconsin won’t go higher. It holds businesses, our economy and local communities back. A higher wage has been studied time and again to be a huge boon for main street businesses – the vast majority of this extra income is spent back in the worker’s neighborhood, city or commuting zone.”
Twenty states have minimum wages no higher than the $7.25 federal level: Alabama, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Wisconsin and Wyoming. There is no state minimum wage in five of these states – Alabama, Louisiana, Mississippi, South Carolina and Tennessee – and in Georgia and Wyoming, the minimum wage is just $5.15, so the federal $7.25 minimum wage applies.
Millions of workers still earn very low wages. For example, in Louisiana, according to the Bureau of Labor Statistics, the median hourly wage for home health and personal care aides in 2024 was just $10.18. That means half of those workers earn less than $10.18. In Mississippi, the median hourly wage for fast food cooks was $10.70. The median hourly wage for childcare workers was $10.46 in Mississippi, $10.63 in Louisiana and $10.78 in Alabama. Again, the median wage is the midpoint, not the bottom.
Seventeen states plus D.C. currently have a minimum wage of $15 or higher, or are phasing in scheduled increases to $15 or higher: Alaska, D.C., California, Connecticut, Delaware, Florida, Hawaii, Illinois, Maryland, Massachusetts, Michigan, Missouri, Nebraska, New Jersey, New York, Oregon, Rhode Island and Washington State. The two highest currently are D.C. at $17.95 and Washington at $16.66.
Raising the federal minimum wage is the only way to ensure that workers across the country earn decent wages wherever they live and whoever they work for. Nationally, more than 14 million workers are paid less than $15 per hour, including overtime, tips, and commissions, according to the Economic Policy Institute’s Low Wage Workforce Tracker; nearly 27 million are paid less than $17.
