Minimum Wage in the United States of America

Have you ever wondered why there is a set minimum amount of money that employers in the USA must pay their employees? This amount of money is called minimum wage, and the amount it is set at varies by state in the US, and varies by country internationally. Since 2009, the federal minimum wage has been 7.25 dollars an hour, but if an employee works for more than 40 hours a week, they qualify for overtime pay, set at one and a half times their usual rate, according to the U.S Department of Labor. To be eligible for minimum wage, employees must be covered under the Fair Labor Standards Act (FLSA), a U.S. law regarding wages and working hours. However, there are still jobs that aren’t covered by the law, such as independent contractors like gig workers, freelancers, and casual jobs outside an agency, including babysitting or caring for elderly. If an employee is not covered by the FLSA, they are not eligible for federal minimum wage and instead fall into the individual states minimum wage requirement. According to NCSL, those people may risk making less than the required $7.25/hour, as some states such as Georgia and Wyoming have minimum wages set to as low as $5.15/hour. 

Governments are motivated to implement a minimum wage for various reasons, but most clearly it is to ensure that employees are accurately compensated for their work. Many believe the same, that having a minimum wage is crucial for employees to be able to maintain financial stability on a basic salary, reducing poverty across states. Additionally, supporters recognize that minimum wage helps avoid the exploitation of workers by their employers, and may even motivate workers to maximise their efforts at work, given the higher pay. However, critics worry that the minimum wage will keep rising, as certain states have increased their wages to more than the federal minimum wage. Their concern is that with higher minimum wage, businesses will have to raise their prices, which fuels inflation. They also argue that with increased prices, the general cost of living will subsequently increase, meaning those workers may not even benefit from the extra salary. 

Whether people agree with employees earning minimum wage or not, it’s a legal requirement and here to stay. Therefore, it is essential for individuals who are starting new careers, interviewing with companies, or even switching jobs to understand their rights, see what pay they are eligible for, and ensure they are earning those benefits to live a fulfilling, stable life.