The 1970 minimum wage was $1.60/hr, a rate that had been set back in 1968 and didn't move again until 1974. The federal minimum wage then went through five increases in the rest of the 1970s, more than in any other decade before or since.
The 1970s were a volatile decade for the US economy, and that volatility shaped how Congress handled the minimum wage. The 1973 Arab oil embargo drove energy prices sharply higher, feeding into a period of stagflation - a combination of slow economic growth and high inflation that defined much of the decade. Federal minimum wage policy in the 1970s has to be read against that backdrop: five increases within six years reflect an attempt to keep pace with a fast-changing cost of living, even if the ultimate result was uneven.
Federal Minimum Wage in 1970 and Through the Decade
- 1970-1973: $1.60/hr. No change: this rate had been set in 1968 and stayed flat until 1974.
- 1974: raised to $2.00/hr, effective May 1, 1974.
- 1975: raised to $2.10/hr, effective January 1, 1975.
- 1976: raised to $2.30/hr, effective January 1, 1976.
- 1977: $2.30/hr. No change that year.
- 1978: raised to $2.65/hr, effective January 1, 1978.
- 1979: raised to $2.90/hr, effective January 1, 1979.
Amendments to the Fair Labor Standards Act typically phase a new minimum wage in over several years rather than raising it in a single step, a pattern that has held for nearly every major federal increase since 1938.
Congress passed the underlying 1974 amendment against this same backdrop, with unemployment rising and consumer prices climbing faster than they had in decades. Lawmakers built a five-step phase-in - 1974, 1975, 1976, 1978, and 1979 - rather than a single jump. The one-year pause in 1977, when the rate held at $2.30/hr, fell in the middle of that phase-in schedule rather than reflecting a separate policy decision.
Why Did the Rate Change So Often in the Late 1970s?
The five increases between 1974 and 1979 all came from a single 1974 amendment to the Fair Labor Standards Act, which scheduled a multi-year phase-in rather than one lump increase. This is the same pattern Congress has used for nearly every major federal minimum wage increase since: pass one law, phase the rate up over several years. The late 1970s saw high inflation, which is part of why lawmakers built in a faster phase-in than earlier or later amendments used.
Context matters here because the raw numbers understate how disruptive the early-to-mid 1970s were economically. The 1973 oil embargo sent energy costs up sharply, and higher energy costs fed into the price of nearly everything else, from transportation to manufacturing to food. Consumer prices rose faster in the mid-1970s than they had in most of the preceding two decades. A minimum wage rate that felt adequate in 1974 could feel considerably less adequate by 1977 if it hadn't moved, which is part of why the five-step 1974 amendment mattered: it was designed to keep raising the wage on a fixed schedule through a stretch of unusually high inflation.
How Did the 1970 Minimum Wage Compare to Today?
The $1.60/hr rate in 1970 sounds tiny next to today's $7.25/hr federal minimum wage, but inflation explains almost the entire gap. Measured in today's dollars, $1.60/hr in 1970 had considerably more purchasing power than the raw number suggests, since prices for housing, food, and most goods were far lower at the time. The 1970s ended with a $2.90/hr federal minimum wage, roughly 81% higher in nominal terms than the decade's starting rate.
That inflation cuts both ways when comparing decades. A $1.60/hr wage in 1970 bought considerably more than $1.60 buys today, just as the decade's closing rate of $2.90/hr in 1979 bought more than $2.90 does now. Any comparison across 50-plus years has to account for how much prices have risen in the interim, not just how the raw hourly figures compare, since the purchasing power of a dollar changed substantially even within the decade itself.
What Expanded During This Period?
Beyond the rate increases, 1970s-era amendments to the FLSA also expanded coverage to more employers and employees than the original 1938 law had reached, part of a broader pattern of the law's scope growing alongside its dollar figures through the mid-20th century.
The most significant coverage expansion came with the 1974 FLSA amendments, which extended federal minimum wage protection to categories of workers who had been excluded from the original 1938 law and its later updates. Domestic workers - housekeepers, cooks, and other household employees - gained minimum wage coverage for the first time. Federal, state, and local government employees, who had also fallen outside the law's reach, were brought under the same minimum wage requirements as private-sector workers. These changes didn't affect the dollar figure itself, but they meaningfully widened who the federal minimum wage actually protected.
Why Nominal Dollar Figures From the 1970s Can Be Misleading
Comparing a $2.90/hr rate from 1979 directly to today's $7.25/hr, without adjusting for inflation, understates how much the minimum wage actually grew in real terms over that period. The 1970s in particular saw unusually high inflation in the US economy, which is exactly why Congress built a faster, five-step phase-in into the 1974 amendment rather than a single flat increase. Any serious comparison across decades needs an inflation adjustment, not just the raw dollar figures.
The relationship between the nominal rate and its real, inflation-adjusted value wasn't steady across the decade. In years with a scheduled increase, the real value of the minimum wage tended to hold up better against rising prices. In a gap year like 1977, when the rate stayed flat at $2.30/hr while prices kept climbing, the real value eroded until the next scheduled step caught up. That pattern - a nominal increase followed by gradual erosion, then another increase - is common whenever a wage is raised on a fixed schedule during a high-inflation period.
Frequently Asked Questions
What was the minimum wage in 1970?
$1.60 per hour, the same rate that had been set in 1968. It didn't change again until May 1974.
What was the minimum wage in 1972?
Still $1.60 per hour. No federal increase occurred in 1972; the next change came in 1974.
How many times did the minimum wage increase in the 1970s?
Five times: 1974, 1975, 1976, 1978, and 1979, all from a single 1974 law that phased in the increases over several years.
What was the federal minimum wage by the end of the 1970s?
$2.90 per hour, effective January 1, 1979.
Which workers gained minimum wage coverage for the first time in the 1970s?
Domestic workers, such as housekeepers and other household employees, along with federal, state, and local government employees, gained federal minimum wage protection through the 1974 FLSA amendments. Both groups had been excluded from earlier versions of the law.
Did the minimum wage keep up with inflation in the 1970s?
Unevenly. The nominal rate rose from $1.60/hr to $2.90/hr over the decade, but high inflation - especially after the 1973 oil embargo - meant the real, inflation-adjusted value of the wage didn't rise as steadily as the dollar figures suggest.
How the 1970s Compares to Other Decades
Five increases in ten years makes the 1970s the most active decade in federal minimum wage history by number of raises, edging out even the FLSA's earliest years. Compare that to the 1980s, which saw the rate frozen for over nine years after a single 1981 increase, or the current stretch since 2009, now the longest gap on record. See our 1980s wage freeze breakdown for the decade that followed.
That freeze is a useful contrast to the 1970s' five increases: where the 1970s tried to keep pace with inflation through a fixed, multi-year phase-in schedule, the early 1980s took the opposite approach, holding the nominal rate flat for years while prices continued to rise.
See the complete federal minimum wage history from 1938 to 2026, or check your state's current minimum wage. For official historical rate data, see the US Department of Labor's minimum wage history chart.
