Political  Calculations

Not long ago, we featured a pretty cool looking chart illustrating the many minimum wages that have applied at the federal and for various states in the U.S. since 1994. Today, we're streamlining things a bit to determine the national average minimum wage for the United States!

To do that, we've calculated the percentage share of each state's population with respect to the combined population of all 50 states and the District of Columbia, and multiplied each state's share of the U.S. population by the greater of either the federal minimum wage or the state's minimum wage. We then summed up the results for each year from 1994 through 2012 to find the population-weighted national average minimum wage for the United States.

Those basic results are presented below:

Nominal Federal vs National Average Minimum Wage, 1994-2012

And here are the results for each year again, this time adjusted for inflation to be in terms of 2012 U.S. dollars!

Inflation-Adjusted Federal vs National Average Minimum Wage, 1994-2012 [Constant 2012 U.S. dollars]

In these charts, the biggest deviations from the federal minimum wage in any given year can be mainly attributed to large population states that have set their minimum wages well above the level set by the federal government. The largest deviation occurred at the beginning of 2007, when states like California ($7.50), Florida ($6.67), Illinois ($6.50), Massachusetts ($7.50), New York ($7.15) and Washington ($7.93) had set their minimum wages significantly above the U.S. minimum wage of $5.15 per hour.

Political Calculations

Political Calculations is a site that develops, applies and presents both established and cutting edge theory to the topics of investing, business and economics.

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