Center for American Progress

Raise and Index the Minimum Wage to Half the Hourly Wage
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Raise and Index the Minimum Wage to Half the Hourly Wage

Congress should restore the minimum wage to 50 percent of the average wage, about $8.40 an hour in 2006. Doing so would help nearly 5 million poor workers and nearly 10 million other low-income workers.

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At $5.85, the federal minimum wage is all too often still not high enough to make ends meet, even for full-time workers. The federal minimum wage was once 50 percent of the average wage but is now 30 percent of that wage. Congress should restore the minimum wage to 50 percent of the average wage, about $8.40 an hour in 2006. Doing so would help nearly 5 million poor workers and nearly 10 million other low-income workers.

We recognize that setting the minimum wage too high could result in undesirable job loss. Research in recent years, however, has found that modest increases in the minimum wage have modest or no effects on job loss. We believe that the benefits of our proposed minimum wage increase would far outweigh any costs. An adequate minimum wage should be a foundation for our efforts to ensure that work is protection from poverty.

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