How the Minimum Wage Works in the USA: Complete 2025 Guide for Brazilians

Many Brazilians who wish to work or reside in the United States often face a fundamental question: what is the exact minimum wage in the USA? The answer is more complex than it seems, as it differs drastically from the Brazilian model. While our country maintains a single national floor, the American system operates in a decentralized manner, allowing states, counties, and even municipalities to establish their own wage guidelines.

The American Decentralized Compensation System

The federal minimum wage in the United States is US$ 7.25 per hour — a value that has remained unchanged since 2009. However, this is only the national minimum base. In practice, most states have significantly surpassed this level, adopting rates ranging from US$ 11 to US$ 16 per hour. Regions with a high cost of living, such as Seattle, Los Angeles, and New York City, have implemented their own minimum wages, often exceeding US$ 15 per hour.

Comparison: Minimum Wage in the USA versus Brazil

The comparative analysis between the two countries reveals important nuances. The US federal minimum wage of US$ 1,160 per month (calculated based on 40 hours per week) may seem insignificant when converted to reais using direct rates. However, when considering the real purchasing power in each economy, the assessment becomes more balanced.

In 2025, Brazil established a national minimum wage of R$ 1,518, while the US floor remains at US$ 7.25/hour. Using an approximate exchange rate of R$ 5.20 per dollar:

• US federal minimum wage: US$ 1,160/month ≈ R$ 6,032
• Brazilian minimum wage: R$ 1,518

At first glance, the value in reais of the American salary appears four times higher. However, operational costs in the USA are also proportionally higher, making this direct comparison misleading.

Regional Variation in the United States

The District of Columbia leads as the region with the highest minimum wage in the USA, offering US$ 17.50 per hour. Washington follows closely with US$ 16.66/h, while California standardizes at US$ 16.50/h. New York differentiates its regions: New York City and surrounding areas pay US$ 16.50/h, while the rest of the state offers US$ 15.50/h.

On the other hand, states like Georgia and Wyoming maintain rates of US$ 5.15/h for certain employers, although the federal floor of US$ 7.25 prevails in most practical situations.

Practical Monthly Compensation Calculation

The American system is based solely on hourly payment, facilitating direct calculations:

Basic formula: Hourly rate × 40 hours × 4 weeks = Monthly income

For the federal floor:

• Weekly: US$ 7.25 × 40 = US$ 290
• Monthly: US$ 7.25 × 40 × 4 = US$ 1,160

In Washington DC, where the minimum wage in the USA reaches US$ 17.50/h:

• Monthly: US$ 17.50 × 40 × 4 = US$ 2,800

Converting to reais (R$ 5.20/dollar):

• Federal: R$ 6,032/month
• Washington DC: R$ 14,560/month

Who Actually Receives These Values

The minimum wage in the USA applies to specific categories of workers:

• Over 14 years old with a work contract
• Employees in regular positions (not apprentices or interns)
• Professionals who do not rely predominantly on tips

The most common occupations include cashiers, cleaning assistants, stock clerks, fast-food attendants, and supermarket employees. Professionals who receive tips often earn a lower base amount, compensated by customer contributions.

The Reality: Insufficiency of the Minimum Wage in the USA

Despite the numbers, the answer to “is it possible to live on minimum wage in the USA?” is predominantly no. Basic survival costs significantly exceed earnings:

• Essential expenses (excluding housing): US$ 1,185/month
• National average rent: US$ 1,626/month
• Total: US$ 2,811/month

Even in states with higher minimum wages like California or District of Columbia, the cost of living increases proportionally, creating a continuous challenge for workers.

Different Structural Model

The fundamental difference between the systems lies in the governmental approach. Brazil establishes an annual national minimum wage via federal decree. The United States, on the other hand, adopts a hybrid model where the federal floor coexists with state and municipal regulations, resulting in substantial regional disparities.

This decentralized architecture allows high-cost-of-living regions to adjust their wage policies independently, while other areas remain close to the federal floor.

For Brazilians considering opportunities in the United States, it is recommended to research not only the minimum wage in the desired state’s US but mainly the local cost of living, which will be decisive for actual financial viability.