The federal minimum wage of $7.25 an hour hasn't changed in 14 years. But with unemployment at a historic low of just 3.5 percent employers are offering much more to attract scarce workers and keep them on their payroll.
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00:00 With the tight labor market, workers are hard to come by.
00:02 Some employers are having to raise wages well above the federal minimum wage.
00:07 In many places, the federal minimum wage is no longer a livable wage.
00:11 The federal minimum wage at seven dollars and twenty five cents an hour
00:16 hasn't changed in 14 years, but with unemployment at a historic low
00:20 of just three point five percent, employers are offering much more
00:25 to attract scarce workers and keep them on their payroll.
00:28 In today's tight jobs market.
00:31 In addition, 30 states and Washington, D.C., have now passed wage minimums
00:35 that are often much higher than the federal minimum,
00:38 making it increasingly irrelevant in some places.
00:41 In such an environment, workers have the upper hand to demand higher pay.
00:46 And so we can look at, for example, some of the largest retailers
00:50 in the country which have raised their wages
00:53 somewhat consistently over recent years.
00:56 And that was not because they had a social objective in mind.
01:01 It was because they need to accomplish their business objectives.
01:04 And they also want to have team members that are engaged
01:09 and are in a position to succeed.
01:11 If these people are essentially not able to put food on the table,
01:15 then how are they going to show up for work?
01:18 Bankrate senior economic analyst Mark Hamrick says workers are also
01:22 prioritizing working from home and four day work weeks.
01:26 Coming out of the pandemic in a world where hybrid work and remote work
01:31 are prioritized, along with a four day work week,
01:34 some businesses are having to pay more just to attract the kind of worker
01:38 they want. At Bankrate, we just unveiled a new survey this week
01:42 that found that 89 percent of American workers
01:45 are prioritizing some combination of a four day work week,
01:50 remote work or hybrid work.
01:53 Five states don't have their own minimum wages, including Alabama.
01:56 Louisiana, Mississippi, South Carolina and Tennessee.
02:00 In those cases, the federal minimum wage kicks in.
02:03 Retailers and restaurants are also raising wages on their end
02:07 to compete in the tight labor market.
02:09 Because I want to keep my, you know, good workers.
02:11 And they've been loyal to me for so many years.
02:13 So I don't mind paying them extra.
02:15 But a raise in wages also means a raise in customer prices.
02:19 The folks are making a good living, but it's costing us.
02:23 We're going to have to definitely raise prices.
02:26 Now, there is a push in Congress brought by Senator Bernie Sanders
02:31 to raise the federal minimum wage to 17 dollars by 2028.
02:35 However, the likelihood of it passing through Congress is slim.
02:39 Stephanie Sandoval, Scripps News, Nashville.