U.S. Federal Minimum Wage Remains at $7.25 While Average Market Wage Reaches $12.13

The U.S. federal minimum wage has remained at $7.25 per hour for 17 full years as of July 2026, Fortune reported. The wage's purchasing power stands at its lowest value in 70 years. A full-time year-round job at that rate fell below the $15,650 poverty threshold in 2025.

Wage growth slowed from 6.7 percent in July 2022 to 3.6 percent as of June 2026. , set higher minimums, yet more than one-quarter of Mississippi workers and one-fifth of workers in Arkansas, Oklahoma, and Alabama earn below $15 an hour.

A 1987 study by Congressional Budget Office economists found 20 percent of workers paid at or below the then-minimum earned incomes under the poverty line. Opponents point to market wages. The Cato Institute calculated an average minimum wage of $12.13 as of January 2026.

In California, a $20 fast-food wage took effect in 2024. One study found the sector lost 18,000 jobs relative to the broader market, while a University of California at Berkeley paper found an 11 percent rise in weekly wages for eligible workers and no employment drop. About two dozen states plan increases in 2026.

“A lot of people are watching what’s happening in California,” Michael Reich, the study author and chair of the Center on Wage and Employment Dynamics at UC Berkeley, told Fortune.