Economics
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What Would Minimum Wage Be If It Kept Up With Housing?
I pulled the data and verified the math. The answer is… not great.
The Numbers We’re Working With
In 1950, the federal minimum wage was $0.75 per hour. A median owner-occupied single-family home cost $7,354.
In 2026, the federal minimum wage is $7.25 per hour — unchanged since 2009. The median U.S. family home price is $429,129.
These numbers come from multiple independent sources. Let’s see what happens when we put them side by side.
The Home-Labor Index
I’m using a simple metric here: how many hours of minimum-wage work does it take to buy a median home? No mortgages, no interest rates, no down payments; just raw labor hours versus home price.
1950:
- $7,354 ÷ $0.75/hr = 9,805 hours
- At 40 hrs/wk × 52 wks = 2,080 hrs/yr
- That’s 4.71 years of full-time minimum-wage work
2026:
- $429,129 ÷ $7.25/hr = 59,191 hours
- Same 2,080 hrs/yr
- That’s 28.46 years of full-time minimum-wage work
In 1950, a minimum-wage worker needed under 5 years of gross income to cover a median home. In 2026, that same worker needs over 28 years. The ratio has gotten roughly six times worse.
So What Should Minimum Wage Be?
If we wanted to preserve the same home-purchasing power that a minimum-wage worker had in 1950, we can work backwards:
- 2026 Median Home Price ÷ 1950 Home-Labor Index
- $429,129 ÷ 9,805 hours = $43.77 per hour
We can verify this another way. The 1950 ratio was 4.714 years of income to buy a home. To maintain that ratio in 2026:
- $429,129 ÷ 4.714 = $91,029/yr required income
- $91,029 ÷ 2,080 hours = $43.76/hr
Both methods land in the same place. To have the same relationship between minimum wage and housing that existed in 1950, the federal minimum wage would need to be roughly $43.77 per hour
You don’t need a PhD to look at these numbers and see the wage gap disparity. The gap between wages at the bottom and the cost of the most basic economic asset, a home, has grown dramatically. That the gap exists isn’t debatable.
The federal minimum wage has been $7.25 since 2009. That’s 17 years without an increase. Meanwhile, median home prices have roughly doubled in that same period.
If we cared about the citizens, we’d need to 6x the minmum wage while also working at more affordable housing for the middle class.
/ Economics / Housing / Minimum wage / Data
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How American Steel Disappeared
I was playing games with the boys and somehow we landed on the topic of US steel manufacturing. I got curious enough to dig deeper, so here’s what I learned about how the American steel industry transformed over the past 150 years.
The Geography of Steel
Let’s start with the basics. What is steel made of? Iron ore, coal, and limestone. The traditional process required roughly twice as much coal as iron, so it always made sense to move the iron to the coal rather than the other way around.
When you think about coal in America, what comes to mind? Pennsylvania. Appalachia. West Virginia. Coal country.
But where does the iron ore come from?
Minnesota. That wouldn’t have been my first guess either, but there’s an area called the Mesabi Range northwest of Duluth where iron ore sits close enough to the surface that we could dig massive open pits instead of deep shafts.
I mean there were a lot of other places too, like Michigan and Wisconsin, but Minnesota was the biggest producer.
So the system worked like this: ship all that Minnesota iron across Lake Superior and over to Pittsburgh, where the coal was. That’s where the steel industry built itself up. US Steel became the first billion-dollar corporation and produced roughly half of the world’s total output through the 1950s.
Electricity Changed Everything
What else happened in the 1950s? The country finally got fully electrified. It’s kind of wild to think about given how ubiquitous electricity is now, but a fully electrified America is a relatively recent thing.
Why does electricity matter for steel? In the mid-to-late 1960s, we developed the Electric Arc Furnace. Instead of needing massive amounts of coal to smelt iron, we could just melt it using electricity. Suddenly, you could make steel wherever you had iron and power.
This flipped the entire industry. Steel production went from requiring huge capital investments and heavily unionized operations to something cheaper, less regulated, and non-union. The old model crumbled.
Enter China
You might be thinking: what about China? Isn’t that where all the steel comes from now?
That shift didn’t really happen until the 1990s and early 2000s. China went from a minor player, to the world’s dominant steel producer remarkably fast.
Well, the thing is, China doesn’t have great domestic iron ore. They import huge quantities of high-grade ore from Australia and Brazil.
Why does that work economically? A few reasons. First, they buy in such massive quantities and ship it on enormous vessels designed specifically for iron ore that the per-unit cost stays low.
Second, and this is the smart part, they deliberately built their steel manufacturing right at the ports. The iron comes off the ships and travels almost no distance before becoming steel.
From there, they can easily decide whether it goes inland for finished goods, or gets used domestically for construction, or gets re-exported.
China also benefits from state subsidies and historically low labor costs. Though with today’s mechanization and robotics, that labor gap isn’t as significant as it used to be.
Where We Are Now
The American steel industry has been struggling for decades, facing intense competition from low-cost producers like China. Despite efforts to modernize and innovate, the industry has struggled to compete.
So we’ve been struggling but does it still exist? Well, sorta. In 2025, Nippon Steel, a Japanese company, acquired US Steel and became the second-largest steelmaker in the world.
The current administration approved the deal with some agreements in place to protect American interests, so the US headquarters would remain in Pittsburgh.
While there are Americans today still making steel, it’s only as a subsidiary of a foreign company. American in name only. American owned and operated steel manufacturing has dissapeared.
How did I do? Should I do more of these type of posts?
/ History / Manufacturing / Economics / BookReport