Mar 15, 2016 3 min read

In 1968, U.S. workers received a minimum wage of $1.60 per hour, an amount that today would get you a large soft drink at a fast-food outlet with maybe a tiny bit of change left over.

But American workers who were at the bottom of the income scale were getting a pretty good deal 48 years ago. According to the U.S. Labor Department, $1.60 in the year when the Beatles’ “Hey Jude” was the biggest hit would be the rough equivalent of $10 in today’s dollars.

The hard reality is that the current federal minimum wage – set at $7.25 per hour – does not have the purchasing power that it did a half-century ago. In fact, it doesn’t even buy as much as it did in 2009, the last time the federal minimum wage was adjusted. Since then, it has lost about 8 percent of its purchasing power to inflation.

President Obama has supported an increase in the federal minimum wage, but that is one of many issues that has fallen victim to Capitol Hill intransigence. Not waiting for Washington, D.C., to get its act together, many states and cities have raised their minimum wages, and Pennsylvania took a tentative step in that direction earlier this month when Gov. Tom Wolf signed an executive order raising the minimum wage to $10.15 per hour for a limited number of state workers.

Since the majority of state employees earn well over the minimum wage, the number who will be impacted by the wage increase will mostly be part-timers who are janitors or clerical support staff. It will also raise the minimum wage to $10.15 for workers on jobs contracted by the state. Wolf signed the order as part of an effort he is spearheading to raise the minimum wage for all Pennsylvanians and indexing it to inflation. This would put Pennsylvania in line with all of its neighbors, from West Virginia to the south and west and New York to the north, that have raised their minimum wages.

A $10.15 per hour minimum wage does not come close to matching the $15 minimum being sought by Democratic presidential candidate Bernie Sanders or activists who have been leading protests at fast food outlets. But Wolf and other lawmakers who are taking steady, incremental steps on the minimum wage are taking the right approach. Raising the minimum wage to $10.10 an hour won the support of 73 percent of respondents in a 2014 survey from the Pew Research Center, including 53 percent of Republicans. In a conversation with the Observer-Reporter last week, Wolf noted that raising the minimum wage to somewhere in the vicinity of $10 has bipartisan support.

But he also acknowledged the concerns of those who argue that a minimum wage that reaches as high as $15 per hour – more than double the current minimum wage – would have a potentially detrimental effect on rural businesses and communities with lower costs of living. After all, being paid $15 per hour in Philipsburg will buy you a lot more than it will in Philadelphia.

Nevertheless, giving low-paid workers a small raise would likely help businesses retain employees, which will reduce their training and employment costs, and inject more money into the economy, since low-wage workers spend more of their paychecks. Boosting the minimum wage to $10.15 per hour would also help state coffers, bringing in an estimated $225 million in revenue.

Opponents of a minimum-wage increase will almost certainly argue it would be a job killer, or it should be put off for another day. But with the national unemployment rate below 5 percent and labor markets tightening, what time would be better?