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I've seen a lot of tweets about minimum wage recently, but no one is mentioning a very important term known as "buying power". So let's start with 1970's minimum wage for $2/hr. (I would like to mention that many people made over minimum. My dad made $3.50 in high school.)
So we plug in $2/hr in 1970 into a simple inflation calculator we get 13.50/hr today. Okay sounds reasonable. Now let's equate that to some things people buy on a daily basis, food, clothing, shelter, etc.
A big mac in 1970 = $0.60 cents
One hour of work = $2
Therefore 1 hour equals 3.33 big macs
A big mac in 2021 = $4.93
One hour of work = $7.25
Therefore 1 hour of work equals 1.47 big macs
If minimum wage increased with the Big mac index (a real thing) minimum wage would be $24
One hour of work = $2
Therefore 1 hour equals 3.33 big macs
A big mac in 2021 = $4.93
One hour of work = $7.25
Therefore 1 hour of work equals 1.47 big macs
If minimum wage increased with the Big mac index (a real thing) minimum wage would be $24
Let's do something else. College.
30 credit hours (1 year old college) in 1970 cost $954, or 477 hours at minimum wage.
30 credit hours in 2019 cost on average $24,950 or 3,441 hours at minimum wage.
If minimum wage increased with college tuition, minimum wage would be $55.81
30 credit hours (1 year old college) in 1970 cost $954, or 477 hours at minimum wage.
30 credit hours in 2019 cost on average $24,950 or 3,441 hours at minimum wage.
If minimum wage increased with college tuition, minimum wage would be $55.81
Shelter
Monthly rent for a 1 bedroom apartment in 1970 was about $108, or 54 hours.
Monthly rent in 2021 is about $750 or 104 hours at minimum wage.
If minimum wage increased at the rate shelter prices increased, minimum wage would be 13.33.
Monthly rent for a 1 bedroom apartment in 1970 was about $108, or 54 hours.
Monthly rent in 2021 is about $750 or 104 hours at minimum wage.
If minimum wage increased at the rate shelter prices increased, minimum wage would be 13.33.
There are literally hundreds of items you can do this with. And EVERYTHING cost more "hours" than it did in 1970. Not to mention new monthly fees that have been created over the years, such as cell phones, internet, and digital TV.
