Federal Minimum Wage History: 1938 to 2026

The Fair Labor Standards Act of 1938 was signed by President Franklin D. Roosevelt on 25 June 1938 and took effect on 25 October 1938. It established the first federal minimum wage in US history at $0.25 per hour -- equivalent to roughly $5.42 in 2026 purchasing power.

The FLSA was part of the New Deal response to the Great Depression. Its primary targets were sweatshops, child labour, and the suppression of wages in the South to attract Northern industry. The original act covered about 11 million workers -- far fewer than the 130 million workers covered today. Key exclusions in 1938 included agricultural workers, domestic workers, and service-sector employees, a pattern that disproportionately excluded Black workers in the rural South.

The initial rate of $0.25 was not arbitrary: it was calculated to cover the minimum cost of living for a full-time worker in the least-expensive US regions. The FLSA required the rate to reach $0.40 within seven years, which it did by 1945.

Coverage expanded significantly in 1961 (retail workers), 1966 (agricultural and service workers), and 1974 (domestic workers). Each expansion brought millions of previously excluded workers under the federal wage floor for the first time.

The 16-year freeze is not an accident of inattention. The Fair Minimum Wage Act of 2007 -- signed by President Bush and sponsored by Senator Kennedy -- was the first federal increase since 1997 and was passed as part of a bipartisan agreement attaching small-business tax relief. That political formula, which had worked in 1996 and again in 2007, broke down after 2009.

The structural barrier is the US Senate's 60-vote cloture threshold for ending debate. Since 2009, every attempt to raise the federal minimum wage has stalled at this point. The Raise the Wage Act was introduced in 2019, 2021, and 2023; each time it passed the House and died in the Senate. The 2021 version, which would have raised the federal rate to $15 by 2025, was ruled out of order under budget reconciliation rules by the Senate parliamentarian.

In the absence of federal action, states and cities have filled the vacuum. By April 2026, 30 states plus DC have minimum wages above the federal floor, and at least 50 cities and counties have enacted local minimum wages above their state floor. This creates a patchwork that frustrates multi-state employers and means a worker's real wage floor depends heavily on geography.

The key legislative proposals as of April 2026 include the Raise the Wage Act (most recently at $17 federal by 2028) and various indexed-to-inflation proposals that would tie the federal rate to 50 or 60 percent of median hourly wages. None has sufficient Senate votes to advance.