Minimum wage simulator
Set the wage floor, productivity, hours and margins to see where an entry-level role sits relative to the wage it can bear.
Interactive policy lab
Does the minimum wage help workers — or price some out of the job market?
Explore the Friedman-style case against wage floors through data, simulations, and policy alternatives. A serious look at labor markets, unintended consequences, and better anti-poverty tools.
Interactive tools on this site are conceptual educational models, not empirical labor-market forecasts.
Scenario tool
Minimum wage simulator
Adjust the wage floor, worker productivity, hours, margins, and region. The simulator uses labor-market tradeoff logic to show where a role sits relative to its employability threshold — not a prediction of actual labor market outcomes.
State minimum wages · 2026
A nation of 50 experiments
State minimum wages range from the federal floor of $7.25 to $18.40 in Washington, D.C. Hover or click any state to see its wage, compare to the federal rate, and read notes on recent changes. The table below is sortable.
$7.25 (federal floor)
$7.26 – $11.99
$12.00 – $14.99
$15.00 – $16.99
$17.00 and above
Select any state on the map to see its 2026 minimum wage, how it compares to the federal floor, and scheduled changes.
| Vs. federal | Notes |
|---|
Data from the U.S. Department of Labor state minimum wage table and state labor departments. Rates shown are standard state minimums as of October 11, 2026, including mid-year changes (D.C., Oregon, Alaska, Florida). Special local or industry rates (e.g., California fast-food, NYC) are not reflected in these totals.
Tools & data
Check the numbers yourself
Four interactive tools, plus the raw data behind them. Each one is built to let you test the argument rather than take our word for it.
50-state wage map
Every state's 2026 minimum wage against the $7.25 federal floor, with a sortable table and notes on scheduled changes. Raw JSON.
Research tracker
23 major minimum wage studies, from Card & Krueger to Seattle, the CBO, Hungary and Germany, filterable by finding and setting. Raw JSON.
Negative income tax calculator
Model Milton Friedman's negative income tax: set the guarantee and phase-out rate, then compare payments and marginal rates with a minimum-wage-only world.
The case, in four parts
The Friedman-style argument against minimum wage laws
The classical free-market critique is not that wages should be low, or that workers don't deserve higher pay. It's that mandated wage floors above a worker's productivity eliminate the exchange rather than improving it. That logic unfolds in four steps.
01
Entry-level workers get priced out first
When the law says an employer must pay at least $X per hour, any role producing less than $X in value becomes unprofitable to offer. The workers most affected are those at the very start of their careers — young, low-skill, or without experience.
02
The first rung of the ladder disappears
A binding wage floor doesn't raise the pay of workers it prices out of a job — it can keep them from being hired at all. Fewer first jobs means fewer opportunities to build skills, references, and on-the-job training that drive lifetime earnings.
03
On-the-job training gets harder
Firms invest in a new hire because they expect the worker's productivity to rise above the wage over time. When the mandated starting wage is above initial productivity, training becomes a net loss — so firms automate, outsource, or simply don't hire.
04
Better tools exist for helping low-income workers
If the goal is to lift incomes, a wage mandate is a blunt instrument that misses the unemployed entirely. The Earned Income Tax Credit, wage subsidies, and training pathways target the same population more precisely — without destroying the jobs meant to help them.
"The minimum wage law is most properly described as a law saying employers must discriminate against people who have low skills. That's what the law says."— Milton Friedman, widely attributed
An honest note
Friedman's argument has been challenged since the 1990s by empirical research — most famously by Card and Krueger, and later by dozens of state-level studies — showing smaller than expected employment effects in some contexts. The modern literature is genuinely contested, particularly on the size and distribution of effects. What we present here is the strong theoretical case; the empirical debate is covered in depth in this article, the full nine-argument case sets each claim beside its counter-evidence, and the research tracker lists the major studies on both sides.
Better tools
What should replace the minimum wage?
If the goal is to raise living standards for low-income workers, wage floors are neither the only tool nor the most targeted one. These alternatives — and in some cases complements — each have different tradeoffs. The honest answer is that no single tool solves the problem alone. (For why a wage mandate is a poor proxy for household need, see living wage vs. minimum wage.)
Earned Income Tax Credit
A refundable tax credit that tops up low earnings. Targets working households rather than wage levels, scales with family size, and doesn't price anyone out of a job. Widely supported across the political spectrum. Its ancestor, Friedman's negative income tax, can be modeled in our NIT calculator.
Wage subsidies
Direct payments to employers or workers when wages are below a target. Preserves the job, raises take-home pay, and targets the population you're trying to help — closing the gap Friedman identified without mandating it.
Payroll tax relief
Payroll taxes drive a wedge between what employers pay and what workers take home. Cutting them at the low end raises take-home pay without raising the cost of hiring — effectively the opposite of a wage mandate.
Apprenticeships & training
Structured pathways that let workers earn while they learn. Pair low initial wages with guaranteed skill development and progression — the original "first rung" model, at scale.
Entry-level work flexibility
Occupational licensing, youth-work rules, and rigid scheduling laws all raise the cost of entry-level hiring. Loosening them expands the number of viable first jobs — especially for students and second earners.
Growth & tight labor markets
The most durable wage increases come from sustained productivity growth and low unemployment. Competition among employers for workers does what wage mandates try to do — without legal price controls.
Side-by-side: three ways to help low-income workers
A simplified comparison across the dimensions that matter most for policy design.
| Dimension | Minimum wage | Earned Income Tax Credit | Wage subsidy |
|---|---|---|---|
| Who pays | Employers (and, through prices, consumers) | Taxpayers, via the federal government | Taxpayers, via a direct subsidy to the role |
| Who benefits | Workers already employed above the new floor | Working households, scaled by family size | Workers in low-productivity roles that would otherwise not exist |
| Employment effect | Potentially negative for low-skill, entry-level workers; debated in the literature | Positive or neutral — rewards work without raising hiring costs | Positive — lowers the effective cost of hiring |
| Targeting | Poor — many minimum-wage earners are second earners in non-poor households | Strong — conditioned on household income and family size | Moderate — targets the role, not the household |
| Political tradeoffs | Popular and easy to legislate; invisible costs (jobs not offered) | Requires a functioning tax administration; more visible cost | Unfamiliar and administratively complex; smaller political constituency |
Nuance
These tools are not strictly substitutes. Some labor economists — including at the Economic Policy Institute and the San Francisco Fed — argue that the EITC and a moderate minimum wage can be complementary, each reaching populations the other misses. The honest policy question is not "one or the other," but what mix of tools produces the best outcome for the workers we're trying to help. Read more → Or try the negative income tax calculator to see how a transfer, rather than a wage mandate, reaches a family's budget.
From the journal
Articles on labor markets, minimum wage policy, and free-market alternatives
Longer essays on the theory, data, and history behind the debate. Written as serious policy journalism — not slogans.
Theory · Start here
The case against the minimum wage: 9 arguments, with the evidence
Nine arguments against the minimum wage, from price controls to the missing first rung, each set beside the best research for it and the strongest research against it. If the case is right, it should survive the comparison.
Data
California's $20 fast-food minimum wage: what every study found
Berkeley found no job losses, NBER economists found 18,000, and Hoover retracted its count. A sourced scorecard of every study, with funders.
Read →Data
What happened when Seattle went to $15
The first big-city $15 minimum wage produced two research teams and two answers. What the UW and Berkeley studies found, and why they disagreed.
Read →Data
What the CBO said about a $15 federal minimum wage
About 1.4 million jobs lost, 0.9 million lifted from poverty. How to read the Congressional Budget Office's estimates and their wide uncertainty range.
Read →Data
Minimum wage and teen employment: what 50 years of data show
Fifty years of BLS data on teen employment, charted against every federal minimum wage increase, with an honest look at what else drove the decline.
Read →Data
Does raising the minimum wage cause inflation?
Wage hikes raise prices once, mostly at restaurants and stores. They don't cause inflation. Meanwhile inflation has cut $7.25's purchasing power by a third.
Read →Theory
Minimum wage pros and cons: the honest version
The strongest case for and against a wage floor, side by side with sources, plus the federal bills in Congress and where we come down.
Read →FAQ
Frequently asked questions
Honest answers to the most common questions we get about minimum wage policy — including the ones we disagree with ourselves on occasion.
What was Milton Friedman's view of the minimum wage?
Friedman argued that minimum wage laws are a form of price control that primarily harms the workers they claim to help — particularly young, low-skill, and minority workers whose productivity falls below the mandated wage. He viewed the law as "discriminating against people with low skills" by making it illegal to hire them at a wage both sides might have accepted. His preferred alternative was the negative income tax, an ancestor of today's EITC. More: what Friedman actually argued, and try his alternative in the negative income tax calculator.
Why do critics say minimum wage reduces employment?
The standard economic argument is that when you set a price floor above the market-clearing wage, quantity demanded falls. For labor, that means fewer hours, fewer positions, or both — especially for low-productivity roles where the wage floor binds hardest. Adjustments also happen at other margins: firms reduce non-wage benefits, increase work intensity, or automate tasks previously done by hand. See the case against the minimum wage in nine arguments, how wage floors push employers toward kiosks and automation, and what 30 years of studies say about jobs.
Does the evidence on minimum wage effects all point one way?
No. Since Card and Krueger's 1994 New Jersey study, the modern empirical literature has been genuinely contested. Some careful studies find small or no disemployment effects at moderate wage floors; others find sizable effects, especially for younger workers and in regions where the floor is high relative to local median wages. The balance of evidence depends on methodology and the size of the wage change relative to the market. We think the theoretical concern is real; we don't think the empirical question is settled. Deep dives: Card & Krueger's New Jersey study, Seattle's $15, California's $20 fast-food wage, the CBO's $15 estimates, and the research tracker of 23 major studies.
Who is most affected by wage floors?
Teenagers, workers without high-school diplomas, and workers in low-cost regions are the most exposed. A $15 minimum wage in Manhattan affects very few workers; the same $15 floor in rural Mississippi would bind for a much larger share of the workforce. That's why national or state-level averages can obscure large differences in local impact. See 50 years of teen employment data, why the first job matters, and the state-by-state guide.
What is the alternative to a minimum wage?
Friedman and many free-market economists favor the Earned Income Tax Credit (EITC) — a refundable tax credit that tops up low wages without raising hiring costs. Other alternatives include wage subsidies, payroll tax relief at the low end, apprenticeships, and reducing occupational licensing that blocks entry-level work. Each has different tradeoffs; none is a silver bullet. Compare the minimum wage and the EITC, read why a living wage depends on the household, not the hourly rate, or model Friedman's negative income tax.
Is this site arguing against helping low-income workers?
No — we're arguing the opposite. The concern is that minimum wage mandates are a blunt, imprecise tool that misses the unemployed entirely and may eliminate first-rung jobs. Better-targeted tools can raise incomes for the same population without those side effects. The case against the minimum wage is a case for more effective anti-poverty policy. For the strongest arguments on both sides, see minimum wage pros and cons: the honest version.
What is the EITC?
The Earned Income Tax Credit is a federal refundable tax credit for low- and moderate-income working households. It phases in as earnings rise, reaches a plateau, and phases out — which means it rewards work, scales with family size, and doesn't price anyone out of a job. It has bipartisan support and has been expanded repeatedly since 1975. How it compares with a wage floor.
Why do economists still disagree?
Labor markets are not frictionless auctions. Monopsony power, firm adjustment margins, spillovers, and enforcement all complicate the basic supply-demand story. Different methodologies — time-series vs. cross-sectional, regional vs. national, bunching estimators vs. difference-in-differences — can produce meaningfully different answers. That's why serious economists on both sides can look at the same data and reach different conclusions. The strongest pro-minimum-wage argument is monopsony; we take it seriously and explain where we think it stops.
Does raising the minimum wage cause inflation?
Not in the economist's sense of a sustained rise in the overall price level. Studies of price pass-through find that higher wage floors raise prices once, mostly in restaurants, groceries and other low-wage sectors, and those increases land partly on the same low-income customers the policy is meant to help. The bigger story runs the other way: inflation has eroded the purchasing power of the $7.25 federal minimum since 2009. The pass-through evidence and a CPI wage calculator.