The 1990 minimum wage was $3.80/hr, raised from the frozen $3.35/hr rate that had held since 1981. The federal minimum wage rose twice in the 1990s overall, once at the start of the decade and once near the end, with a five-year gap in between.
Federal Minimum Wage in 1990 and Through the Decade
- 1990: raised to $3.80/hr, effective April 1, 1990, ending the 1980s freeze.
- 1991: raised to $4.25/hr, effective April 1, 1991, the second step of the same law.
- 1992-1995: $4.25/hr. No change for four years.
- 1996: raised to $4.75/hr, effective October 1, 1996.
- 1997: raised to $5.15/hr, effective September 1, 1997.
The Small Business Job Protection Act of 1996 paired a federal minimum wage increase with tax relief for small businesses, a common legislative pattern when Congress raises the wage floor.
Why Was There a Five-Year Gap Between 1991 and 1996?
The 1990 and 1991 increases were both scheduled under the same law, the Fair Labor Standards Amendments of 1989, signed by President George H.W. Bush. That law built the two-step increase to $3.80/hr and then $4.25/hr directly into the statute, so no new vote was needed for either step. Once the rate hit $4.25/hr in April 1991, though, any further increase required Congress to pass an entirely new bill, and that is where the minimum wage in the 1990s stalled for the better part of five years.
Divided government made a new increase difficult to pass in the first half of the decade. When Republicans won control of both the House and the Senate in the 1994 midterm elections for the first time in 40 years, running on the "Contract with America" platform, the new Congress was not inclined to prioritize a minimum wage hike. President Clinton and congressional Democrats pushed for an increase through 1995 and into 1996, but it took until an election year, with public pressure building and a bipartisan deal that paired the wage increase with tax relief for small businesses, before a bill finally reached the president's desk.
The gap was not entirely a matter of neglect on the anti-poverty front, either. During those same years, the Omnibus Budget Reconciliation Act of 1993 substantially expanded the Earned Income Tax Credit, a policy tool that boosts the take-home pay of low-wage workers without touching the statutory minimum wage. That expansion gave the Clinton administration and Congress an alternative lever to pull while the minimum wage itself sat frozen at $4.25/hr.
What Drove the 1996-1997 Increase?
President Clinton signed the Small Business Job Protection Act of 1996, which included a two-step federal minimum wage increase taking the rate from $4.25/hr to $5.15/hr over two steps. This is the increase that's often referred to as the "Clinton-era" minimum wage increase, and $5.15/hr held as the federal rate for a full decade afterward, until the 2007-2009 increases replaced it. The bill passed just months before the 1996 presidential election, and pairing the wage floor increase with tax breaks for small businesses was the compromise that finally moved it through a Republican-controlled Congress.
How Does the 1990s Compare to Other Decades?
Two increases in ten years puts the minimum wage in the 1990s roughly in line with the law's long-run average pace of about one increase every four years. It's a sharp contrast to the freeze that preceded it in the 1980s, when the rate held at $3.35/hr for nine straight years. The freeze that followed the 1990s increases, by contrast, has run far longer still, as covered below.
What Was the Real Value of the 1990 Minimum Wage?
$3.80/hr in 1990 had meaningfully more purchasing power than its nominal value suggests today, since decades of inflation have since eroded what any fixed dollar figure can buy. The same is true of $4.25/hr in 1991 and $5.15/hr in 1997: each of those rates bought noticeably more in groceries, rent, and everyday goods at the time than the same number of dollars would buy now. This is the same dynamic playing out with the current $7.25/hr rate, which has lost a substantial share of its real value since being set in 2009, and it's a big part of why comparing minimum wage rates across decades by their raw dollar figures alone can be misleading.
The Federal Minimum Wage Since the 1990s
$5.15/hr held as the federal minimum wage for a full decade after September 1997, longer than any single rate had lasted since before the 1980s freeze. It finally moved again under the Fair Minimum Wage Act of 2007, signed by President George W. Bush, which phased in three annual increases: $5.85/hr in July 2007, $6.55/hr in July 2008, and $7.25/hr in July 2009.
Since that final step took effect in July 2009, the federal minimum wage has not moved at all. That makes the current freeze the longest stretch without a federal minimum wage increase in the law's history, surpassing both the nine-year freeze of the 1980s and the five-year gap in the middle of the 1990s. Congress has debated raising it well past its 2009 level many times since, but no bill has passed. Set against that current freeze, the minimum wage in the 1990s, with two separate increases even across a five-year pause, looks like an unusually active decade for federal wage policy.
How Did State Minimum Wages Compare in the 1990s?
Today, most states set a minimum wage above the federal floor, but that pattern is largely a more recent development. Through most of the 1990s, far fewer states had enacted their own higher minimum wage than do today, meaning the federal rate set out above functioned as the binding minimum wage for a much larger share of the country's workforce than it does now. See our current state-by-state minimum wage table to see how differently that landscape looks today.
Frequently Asked Questions
What was the minimum wage in 1990?
$3.80 per hour, effective April 1, 1990, ending the nine-year freeze from the 1980s.
What was the minimum wage in 1995?
Still $4.25 per hour. No change occurred in 1995; the rate had been set in April 1991 and stayed flat until October 1996.
What law raised the minimum wage in 1996 and 1997?
The Small Business Job Protection Act of 1996, signed by President Clinton, which phased the rate from $4.25/hr to $5.15/hr over two steps.
How long did the $5.15/hr rate last?
A full decade, from September 1997 until the 2007-2009 increases replaced it with the current $7.25/hr rate.
Why was there a five-year gap between the 1991 and 1996 minimum wage increases?
Political gridlock. The 1990 and 1991 increases were pre-scheduled in a 1989 law, but any further increase needed new legislation. Republicans took control of Congress in the 1994 midterm elections, and it wasn't until 1996, an election year, that a bipartisan deal pairing a wage increase with small business tax relief finally passed.
What role did the Earned Income Tax Credit play in the 1990s?
While the federal minimum wage sat frozen at $4.25/hr between 1992 and 1996, the Omnibus Budget Reconciliation Act of 1993 significantly expanded the Earned Income Tax Credit, giving Congress and the Clinton administration an alternate way to boost low-wage workers' take-home pay without a new minimum wage law.
How does the minimum wage in the 1990s compare to today's $7.25/hr rate?
The federal minimum wage rose twice in the 1990s, ending the decade at $5.15/hr in 1997. It rose three more times between 2007 and 2009 to reach $7.25/hr, and it has been frozen at that level ever since, now the longest stretch without an increase in the law's history.
Did the minimum wage increase every year in the 1990s?
No. It increased in 1990, 1991, 1996, and 1997, with no change at all between 1992 and 1995.
How the 1990s Compares to Surrounding Decades
Two increases in the 1990s looks modest compared to the five seen in the 1970s, but it's a marked improvement over the single increase (followed by a nine-year freeze) that defined the 1980s. See our 1980s wage freeze breakdown for the decade immediately before it.
See the complete federal minimum wage history from 1938 to 2026, or check your state's current minimum wage. For official historical data, see the US Department of Labor's minimum wage history chart.
