Since it was first instituted in 1938, the federal minimum wage has established a floor for wages. While not every worker is eligible, it provides a minimum of earnings for the lowest-paid workers.
Many states and even municipalities have their own minimum wages, including twenty that have rates higher than the federal minimum wage.
The current federal minimum wage is $7.25 per hour. A full-time minimum wage employee earns $15,080 annually. In 2014, the poverty guideline for a single person was $11,670. For a family of four with two children it was $23,850.
An individual working full time at minimum wage will make enough to live above the poverty line. However, if he or she is is the sole earner for a family of four, that income is only 65 percent of their federal poverty guideline. At a minimum wage income, even working full time, many workers will still qualify for federal public assistance programs.
The current poverty rate in the U.S. depends in part on the level of the minimum wage. However, many other economic factors, such as the unemployment rate, and individual factors, such as family size and composition, contribute to overall levels of poverty.