Deep within the cavernous halls of the U.S. Capitol, a fierce debate is currently brewing. Every member of government is preparing to toss around responsibility as though it were a basketball. Unfortunately, it seems a slam dunk is unlikely, and with who is holding the ball, it would appear it is instead headed for the stands at rapid speeds.
As of the time of writing, the proposal to raise the federal minimum wage to $15 by 2025 is probably dead on arrival. All too often in American politics, bad faith arguments overpower facts and common sense, and unfortunately, the minimum wage debate is no different.
So in this article, rather than pontificating about small business (perhaps the only term more abused in politics than “the children”), let’s look at the facts and see how a person can survive on the current minimum wage.
We’re going to use the Florida minimum wage of $8.65 rather than the national minimum wage of $7.25. The average workweek is about 40 hours, so that means you would make $346 per week, multiply that by four and apply income tax and you would have roughly $1338 per month.
This is very generous because it assumes you are working 40 hours a week every single week of the year.
According to RentCafe.com, the average rent in Pensacola is about $1106, with the most expensive place to live being Downtown Pensacola at $1605 and the cheapest being Bayou Grove at $997. So let’s say you live in Bayou Grove and you pay $997 a month for rent; that leaves you with $341 leftover.
I probably don’t need to explain that $341 is not enough money to live on. The average cost of a cell phone plan can range from $70 to $113. The average car payment for a used vehicle is $397.
A person making this wage will barely have enough money for food and will certainly have zero upward mobility.
How can a person ever be expected to buy a home or start a small business when they have no money left over in their bank account at the end of every month?
With a wage of $15 an hour, you would make roughly $2229 per month. If you had the same apartment in Bayou Grove, you would be left with roughly $1232 leftover.
Now you are no longer spending all of your income on rent. You have enough money to have a car, buy food, pay for your cell phone, and still have enough left over to save to go to college or buy a house.
It’s not a ton of money, but it is a livable wage.
I hope this demonstration helped you to understand the critical importance of the minimum wage to the lives of millions of Americans, maybe even to yourself or someone you know.