The minimum wage: does it hurt workers?

Synopsis

The minimum wage has sparked fierce debate among economists and politicians for decades, especially following the COVID-19 pandemic and President Joe Biden's push to raise it. Traditionally, economists believed that increasing the minimum wage leads to job losses, fearing it would hurt the very workers it aims to help. However, decades of research have prompted a reevaluation, with 90% of countries now implementing some form of minimum wage. The concept of a minimum wage dates back over a century, with New Zealand introducing the first national base pay laws in 1894. In the United States, the first federal minimum wage was established in 1938 by President Franklin Roosevelt at 25 cents per hour during the Great Depression. Despite this, the federal minimum wage has stagnated at $7.25 per hour, losing value over time and not keeping pace with inflation. This ongoing issue continues to provoke fierce debate about how high the minimum wage can be set without harming workers.