How the federal minimum wage works
The federal minimum wage was created by the Fair Labor Standards Act of 1938. It sets a national pay floor for most hourly workers, though some categories — including tipped employees, certain farmworkers, and some small businesses — are covered by different rules. Congress must pass a law, signed by the president, to change the rate; it does not adjust automatically for inflation.
Where the rate stands today
The federal minimum has been $7.25 per hour since July 2009. That is the longest stretch without an increase since the minimum wage was first established. Adjusted for inflation, its purchasing power has fallen substantially over that period.
States and cities have moved on their own
As of 2026, thirty states plus Washington, D.C. have set minimum wages above the federal floor. California, New York, Washington State, and several others have reached or exceeded $15 statewide, and some cities — including Seattle and parts of California — have gone higher. Workers in states without higher floors, concentrated in parts of the South and Midwest, continue to be covered by the $7.25 federal rate.
What a $15 federal floor could do
The Congressional Budget Office estimated in 2021 that gradually raising the federal minimum to $15 by 2025 would have boosted pay for roughly 17 million workers and lifted about 900,000 people out of poverty. The same analysis projected employment would fall by about 1.4 million jobs. CBO emphasized wide error bars around both figures.
The case for raising it
Supporters argue $7.25 falls below a living wage in nearly every U.S. county and has not kept pace with productivity or inflation. They point to studies of recent state and local increases that have shown limited employment losses, and argue higher pay reduces turnover, lifts consumer spending, and decreases reliance on public assistance programs.
The case against
Opponents argue a uniform $15 floor would hit hardest in lower-cost regions where it represents a larger share of average wages. They warn that employers may respond by cutting hours, slowing hiring, accelerating automation, or raising prices — with the heaviest effects on younger and less-experienced workers. Some also favor leaving the question to states, citing wide variation in local economies.
Why economists still disagree
Decades of research on minimum-wage increases produce a range of results. Recent studies of state and city hikes find employment effects ranging from small positive to small negative, depending on the size of the increase and local labor-market conditions. There is broader agreement that modest, gradual increases have smaller disemployment effects than large or sudden ones, but no consensus on where the tipping point lies for a nationwide $15 floor.
What voters are weighing
The debate ultimately involves tradeoffs between higher earnings for many workers, potential job losses for some, regional cost-of-living differences, and the role of the federal government versus states in setting wage policy. How a voter weighs each of those factors typically shapes their view of the $15 proposal.