Minimum Wage Impact Calculator
How It Works
This minimum wage impact calculator uses established formulas to provide accurate results.
The basic rule:
- Annual Raise = Wage Difference x Hours/Week x 52 weeks
- Total Labor Cost Increase = Annual Raise x Employees x 1.0765 (payroll taxes)
- Price Increase Needed = (Cost Increase x Passthrough %) / Revenue
- Job Impact uses -0.15 elasticity estimate (moderate CBO estimate)
Results are estimates. Consult a professional for critical decisions.
Frequently Asked Questions
Does raising the minimum wage cause job losses?
Research is mixed. The CBO estimated a $15 federal minimum wage would lift 900,000 people out of poverty but eliminate 1.4 million jobs. Most studies find small employment effects (-1 to -3%) for moderate increases, with larger effects for dramatic increases.
How much would prices increase with a higher minimum wage?
Studies find that a 10% minimum wage increase raises restaurant prices about 0.7% and overall prices about 0.4%. Not all costs are passed to consumers — businesses also absorb costs through reduced profits, fewer hours, and efficiency gains.
What is the current federal minimum wage?
The federal minimum wage has been $7.25/hour since 2009. However, 30+ states and many cities have higher minimums. As of 2024, state minimums range from $7.25 to $16.28 (Washington state).
Who actually earns minimum wage?
About 1.1 million workers (1.3% of hourly workers) earn exactly the federal minimum. However, about 20 million workers earn less than $15/hour. The majority are adults (not teenagers), and about 60% are women.