In 2025, 16-year-olds working their first jobs at fast-food restaurants like McDonald’s earn $7.25 an hour if their location pays the federal minimum wage, which many do. If their parents had worked there when those teens were born in 2009, they would have earned the same $7.25.
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The current federal minimum wage is not sufficient to support today’s housing prices — but was it 35 or 45 years ago?
Keep reading to learn whether a minimum wage job at McDonald’s could have supported homeownership in the 1980s.
One Historic Period of Wage Stagnation. Then Another.
The federal minimum wage was $3.35 from Jan. 1, 1981, through April 1, 1990, the longest period of stagnancy in history — up to that point.
On Jul 24, 2009, the minimum wage jumped from $6.55 to $7.25 — where it has remained ever since.
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Inflation has risen by 48% during the current record-high 16-year period of minimum wage stagnation. Had paychecks kept pace with rising prices since 2009, the 2025 minimum wage would be $10.78, which would be more in line with historical averages.
- 1950: $0.75 or $9.98 in 2025 money
- 1968: $1.60 or $14.67 in 2025 money
- 1976: $2.30 or $12.90 in 2025 money
- 1981: $3.35 or $11.76 in 2025 money
- 1996: $4.75 or $9.66 in 2025 money
2025: 73% Higher Home Prices With 62% Less Purchasing Power
In 1981 — when the inflation-adjusted minimum wage was $11.76 — the average home sold for roughly $84,000, according to the St. Louis Fed. That’s about $295,000 in today’s money.
However, the average home in 2025 doesn’t cost $295,000. It costs $510,300.
In short, the 44 years between 1981 and 2025 saw the real minimum wage fall by 62% while the average inflation-adjusted home price rose by 73%.
Minimum wage pay clearly could buy more house back then than it can today — but was it enough?
Homeownership Dreams on a Mickey-D’s Salary: Then and Now
According to Fidelity, most home buyers should shop for a property worth roughly three to five times their annual salary.
- In 1981, a McDonald’s employee earning $3.35 an hour and working 40 hours per week would have earned $6,968 per year — and that’s presuming no days off. That means the $84,000 home would have cost 12 times more than that fast-food worker’s minimum wage salary — about four times Fidelity’s recommended ratio.
- Today’s minimum wage McDonald’s workers earning $7.25 per hour will make $15,080 in 2025, presuming five days a week, 52 weeks per year. They would need not three to five times their annual pay to afford today’s average home — or even the multiplier of 12 required in 1981 — but 34 times their yearly wages. Following conventional personal finance wisdom, they should instead search for a home in the $45,000 to $75,000 range. Unfortunately, that home doesn’t exist except as the farthest outlier.
In summation, McDonald’s workers earning minimum wage in the 1980s might have been able to afford a home if they found the right property at the right price in the right market at the right time, albeit at the farthest realistic reaches of their budgets.
On the other hand, today’s minimum wage McDonald’s employees cannot buy a home — anywhere — no matter how hard they work.
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This article originally appeared on GOBankingRates.com: Could You Buy a House Working at McDonald’s in the 1980s?
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