Democratic lawmakers introduce bill to raise federal minimum wage to $25 an hour

Representatives in Congress are starting a new push to raise the federal minimum wage to $25 an hour.

A group of Democratic representatives, including Reps. Delia Ramirez (D-Ill.) and Analilia Mejia (D-N.J.), introduced the Living Wage for All act on Tuesday, a bill that would gradually raise the federal minimum wage to $25 an hour. If enacted, the bill would require large employers (those with 500 or more employees nationwide or that have gross annual revenues of $1 billion or more) to bring their minimum wage to $25 by 2031, with smaller employers following by 2038.

From there, the federal minimum would rise periodically to ensure it is always equal to two-thirds of the national median wage, which is around $31 an hour as of the first quarter of 2026, according to Bureau of Labor Statistics data.

Currently, the federal minimum wage sits at $7.25 an hour and hasn't increased since 2009. Most states have local minimum wages higher than the federal level, but five states — Alabama, Louisiana, Mississippi, South Carolina and Tennessee — don't have their own state minimum. Georgia, Oklahoma and Wyoming have minimums below the federal level. Workers in these states are generally subject to earn the federal minimum, according to the National Conference of State Legislatures.

A coalition of advocacy and labor organizations called Living Wage for All, which includes One Fair Wage, the NAACP and the American Federation of Teachers, contributed to the creation of the Living Wage for All act.

According to One Fair Wage, a nonprofit organization that advocates to end subminimum wages, the group arrived at the $25 per hour figure based on Massachusetts Institute of Technology's living wage calculator, which estimates that a single adult living anywhere in the U.S. needs to earn at least that much to be able to afford a basic cost of living. MIT uses estimates for costs of essentials like food, housing, healthcare and transportation to determine a living wage.

"No one working full time should be struggling to survive," Mejia said in a press release. "We need an economy that reflects the realities of 2026, not one stuck over a decade ago."

The bill would not only raise the federal minimum wage, but also end subminimum wages that currently exist, such as the tipped wage, which allows workers who receive tips to be paid a base wage as low as $2.13 per hour.

Historically, lawmakers and industry groups who oppose minimum wage increases have argued that the pay raises could have numerous negative impacts for the economy, including fewer jobs and higher prices for consumers as small businesses could struggle to afford higher labor costs.

Additionally, a divided Congress has had difficulty passing legislation to raise the federal minimum wage as lawmakers have not been able to come to a consensus on how much the wage floor should rise.

Studies on the broader effects of minimum wage increases have yielded mixed results. A joint 2024 study from Harvard Kennedy School's Malcolm Wiener Center for Social Policy and the University of California, San Francisco found no unintended consequences, such as staffing shortages or decreased access to benefits, for minimum wage fast food workers when California raised its minimum.

And 2024 research from the University of Michigan and Carnegie Mellon University found more benefits than drawbacks from minimum wage increases, including stronger worker retention and increased revenue at restaurants that raised workers' pay.

On the other hand, a 2023 study by the Federal Reserve Bank of Minneapolis found that while major increases to minimum wage can have positive short-term impacts, the long-term effect could hurt workers by leading to an elimination of lower-skilled and lower-paying roles.

Around 82,000 workers earn the federal minimum wage of $7.25 an hour, according to 2024 data from the Bureau of Labor Statistics, the most recent available. Another 760,000 workers earn wages below the federal minimum.

As of 2022, nearly 6 in 10 jobs paid less than $25 an hour, a separate BLS report from September 2024 found. Around 66 million U.S. workers, or around 45% of the workforce, earned less than $25 an hour in 2026, according to the Economic Policy Institute, a labor-focused policy think tank.

Workers and advocates have been pushing for a higher minimum wage for over a decade. In 2012, a group of fast food workers in New York walked off their jobs to demand a $15 minimum wage, spurning the Fight for $15 movement, which saw workers across industries and states push for higher minimum wages. As of this year, 17 states and Washington D.C. have a minimum wage of $15 or higher.

The idea of raising the federal minimum wage is generally popular. As of 2021, 62% of Americans supported a $15 federal minimum, according to a Pew Research survey. Of those who opposed a $15 minimum, 71% still supported raising the minimum, just to less than $15, Pew found.

The ongoing affordability crisis has made the minimum wage issue even more pressing, the bill's advocates say. Raising the wage isn't just about the cost of living, but also about restoring trust in democracy and the social contract, says Saru Jayaraman, president of One Fair Wage.

The minimum wage was introduced by President Franklin Roosevelt in 1938 so the lowest-paid workers could still afford to live, putting some of the responsibility on businesses to make sure their employees were paid enough, Jayaraman says.

It's unclear whether the Living Wage for All act will become law. Legislators from both the House of Representatives and the Senate have repeatedly proposed raising the minimum wage, including several iterations of the Raise the Wage Act, which was first introduced in 2017 and re-introduced in every subsequent session of Congress since then, without success.

The American Rescue Plan of 2021 almost brought an increase to the federal minimum wage, but the provision was ultimately removed from the package and a separate standalone bill to raise the wage did not receive enough support to pass in the Senate.

However, the recent emphasis on affordability from politicians from both parties may help momentum for the Living Wage for All act, Jayaraman says.

"I do think the more we see every election be determined by this question of, 'Can people survive economically?' and affordability, the more you're going to see more and more elected [officials] feeling like they don't have a choice," she says. "They have to do something on the wage issue."

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