US House Votes to raise Federal minimum wage to $15 in 2025
For six years the internet group Fight for Fifteen has been organizing fast food employees to go on strike in an effort to get $15 per hour for minimum wage.
There are big obstacles to the recent bill that passed the US Congress this week. First of which is that should the bill be voted in Senate, and second signed by the President of the United State into law, or if vetoed overturned by Senate, which is unlikely. The biggest draw back is that no one would see a Federal Minimum wage of $15 per hour until the year 2025, and then it would be adjusted with inflation.
$15 per hour in 2019, would be impressive, however the US Federal Reserve targets inflation at 2% per year. So the delay of this $15 per hour rate until 2025 represents about $1.89 per hour in loss of earnings due to inflation alone in 2025. Since the future raises would be tied to inflation targets this would be a permanent gap. One only to be made up by another petition of government representatives to close the gap, or working towards a job in which the employee is not paid minimum wage.
Another way to look at this gap would be about $2,952 loss of wages per year at 30 hours per week in 2025 and future years. That is to say nothing of the $6.60 gap in 2019, which is thousands of dollars less per year getting out of the gate.
On the more positive side for employees affected some of the more interesting points are that eventually tipped workers such as waiters, and waitresses would eventually be at a true minimum wage of $15 per hour, and tipping could disappear as an implied ritual upon paying a restaurant bill.
Two other groups historically that were allowed to be paid less than minimum wages were teenagers, and also workers with disabilities the ability to have a reduced minimum wage rate for these groups would also be eliminated, and therefore paid $15 in year 2025.
The minimum wage hikes would take effect on the following schedule:
$8.40 in 2019 basic annual income with 40 hours per week 52 weeks per year would be $17,472.00, and take home of $13,104.00 with a basic 25% tax rate.
$9.50 in 2020 basic annual income with 40 hours per week 52 weeks per year would be $19,760.00, and take home of $14,820.00 with a basic 25% tax rate.
$10.60 in 2021 basic annual income with 40 hours per week 52 weeks per year would be $22,048.00, and take home of $16,536.00 with a basic 25% tax rate.
$11.70 in 2022 basic annual income with 40 hours per week 52 weeks per year would be $24,336.00, and take home of $18,252.00 with a basic 25% tax rate.
$12.80 in 2023 basic annual income with 40 hours per week 52 weeks per year would be $26,624.00, and take home of $19,968.00 with a basic 25% tax rate.
$13.90 in 2024 basic annual income with 40 hours per week 52 weeks per year would be $28,912.00, and take home of $21,684.00 with a basic 25% tax rate.
$15 in 2025 basic annual income with 40 hours per week 52 weeks per year would be $31,200.00, and take home of $23,400.00 with a basic 25% tax rate.
However some states are already on pace to be above this $15 per hour minimum wage rate, so this Federal Government rate would only affect states that have their minimum wage rates set under the $15 rate (or other make up years as laid out below).
Raise The Wage
BREAKING: Six years after the first #FightFor15 strike, the U.S. House just passed the #RaiseTheWage Act to increase the federal minimum wage to $15 an hour!
Organizing works. Strikes work. We’re not even close to done! #RaiseTheWageNow pic.twitter.com/H9FDVSfvPQ
— Fight For 15 (@fightfor15) July 18, 2019