I provide here a historical overview of the impact of minimum wage legislation, enacted over 75 years ago in the Fair Labor Standards Act (FLSA) of 1938 and as amended subsequently on numerous occasions.
Given elected officials’ caution today about raising the minimum wage in bad economic times, the timing of the passage of the FLSA is remarkable. After a long and heated political debate, Congress passed the FLSA in 1938, establishing a nationwide minimum wage of $0.25 per hour, with increases to $0.30 in 1939 and to $0.40 in 1945. Importantly, the federal minimum wage established a floor, not a ceiling. States and localities could enact higher minimum wages—although none did until the 1980s.
Citation: Industrial Relations: A Journal of Economy and Society, 54(4):538-546. October 2015.