How does the minimum wage work in the USA in 2025: a complete guide with state-by-state values

Brazilian workers planning to work in the United States often face a fundamental question: what is the minimum wage in the United States? The answer is not as simple as it seems. Unlike Brazil, where there is a single national minimum wage, the American system operates in a decentralized manner, allowing each state — and even cities — to set their own rules.

The American system: federal vs. state

The federal minimum wage has remained fixed at US$ 7.25 per hour since 2009, with no adjustments for 16 years. However, this amount only represents a minimum ceiling. About 30 states have established higher minimum wages, ranging from US$ 11 to US$ 17.50 per hour.

This decentralization creates a highly heterogeneous scenario: a worker earning minimum wage in cities like Seattle, Los Angeles, or Washington D.C. can earn more than double compared to someone in states like Wyoming or Georgia.

The highest minimum wages by state

Some states have led significantly in compensation:

Washington D.C. — US$ 17.50/h (the highest in the country) Washington — US$ 16.66/h California — US$ 16.50/h (with overtime rules: 1.5x after 8 hours daily, 2x after 12 hours) New York — US$ 15.50/h (US$ 16.50/h in the city and surrounding counties)

States like Georgia and Wyoming still allow US$ 5.15/h, but in practice, the federal minimum of US$ 7.25 prevails.

Converting to real-world affordability

The calculation of the American monthly salary is straightforward: hourly wage × 40 hours weekly × 4 weeks.

With the federal minimum wage:

• 7.25 × 40 × 4 = US$ 1,160 per month

Converting to reais (approximate exchange rate of R$ 5.20 per dollar in 2025):

• Federal salary: US$ 1,160 ≈ R$ 6,032/month
• Washington D.C.: US$ 2,800 ≈ R$ 14,560/month

Per week, the worker would earn:

• Federal: US$ 290
• Washington D.C.: US$ 700

Who earns this amount and limitations

The minimum wage applies to:

• Individuals over 14 years old
• Employed under regular hours
• Not acting as apprentices or interns
• Without primary compensation via tips

Typical professions: cashiers, restaurant attendants, stock clerks, cleaning assistants, and entry-level operational roles.

An important caveat: waiters and service professionals who receive tips often earn a lower base wage, as tips supplement the total income.

Brazil × USA comparison: real purchasing power

In gross numbers, the US$ 1,160 federal minimum wage (US$ 1,160) converted to reais (R$ 6,032) appears drastically higher than the Brazilian minimum of R$ 1,518 in 2025. However, this comparison is misleading.

The cost of living issue:

• A worker in the US needs to spend, on average, US$ 1,185/month just on basic expenses (food, transportation, utilities)
• Average rent: US$ 1,626/month
• Total: approximately US$ 2,811

With a federal minimum wage of US$ 1,160, the numbers simply don’t add up. The situation improves in states with higher minimum wages, but cities like San Francisco, New York, and Los Angeles also have proportionally high living costs.

Applying the Purchasing Power Parity (PPP): Economists use this metric for more accurate comparisons. One dollar in the US buys, on average, fewer goods and services than its converted equivalent in reais in Brazil. The absolute difference does not translate linearly into quadrupled quality of life.

Structural difference: Brazil adopts a single national minimum wage set by the government. The US uses a hybrid model with significant regional disparity — some states have very high minimums, others stick to the federal level, creating a highly fragmented reality.

Can you survive on minimum wage in the US?

The straightforward answer is no, in most scenarios.

Even working 40 hours a week, the federal minimum wage covers only 41% of basic expenses. States with higher wages offer greater purchasing power but also have proportionally higher living costs.

Workers relying solely on minimum wage often resort to:

• Multiple simultaneous jobs
• Government assistance (food stamps, housing assistance)
• Sharing housing
• Corporate benefits (health, transportation subsidies)

The outlook in 2025

The minimum wage in the United States remains a decentralized and complex topic. While the federal minimum has been frozen for years, progressive states continue approving increases to keep pace with inflation and local realities.

For Brazilians considering a move, research should go beyond the state minimum: investigate housing costs, transportation, food, and employer-provided benefits as essential steps before any decision.

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