Number: RL30927
Title: The Federal Minimum Wage: The Issue of Indexation
Authors: Gerald Mayer, Domestic Social Policy Division 
Abstract: This report examines several aspects of the issue of indexing the basic federal minimum wage. If indexation were implemented, the approach adopted could well depend on Congress' view of the rationale for having a minimum wage. Therefore, the report discusses the major arguments that have been made in support of a minimum wage. Some economic measures that could be used for indexation appear to be more consistent than others with the major arguments for a minimum wage. Therefore, the report also examines several economic measures that could be used for indexation. Finally, if indexation were adopted, the future value of the minimum wage would depend not only on the economic measure used but also on the base period selected (i.e., initial value of the minimum wage). Using different economic measures and base periods, the report illustrates what the minimum wage would have been in September 2006 (or the end of 2005, depending on the measure) if it had been indexed.
Pages: 22
Date: January 22, 2007