Under New Hampshire regulation, Janette Desmond pays the workers who scoop ice cream and minimize fudge at her Portsmouth candy store as little as $7.25 an hour.

But with the state unemployment fee beneath 2 %, the dynamics of provide and demand trump the minimal wage: At Ms. Desmond’s retailer, youngsters working their first summer time jobs earn a minimum of $14 an hour.

“I could take a billboard out on I-95 saying we’re hiring, $7.25 an hour,” Ms. Desmond mentioned. “You know who would apply? Nobody. You couldn’t hire anybody at $7.25 an hour.”

The red-hot labor market of the previous two years has led to fast pay will increase, notably in retail, hospitality and different low-wage industries. It has additionally rendered the minimal wage more and more meaningless.

Nationally, solely about 68,000 folks on common earned the federal minimal wage within the first seven months of 2023, based on a New York Times evaluation of presidency knowledge. That is lower than one in all each 1,000 hourly staff. Walmart, as soon as famous for its rock-bottom wages, pays staff a minimum of $14 an hour, even the place it will possibly legally pay roughly half that.

There are nonetheless locations the place the minimal wage has enamel. Thirty states, along with dozens of cities and different native jurisdictions, have set minimums above the federal mark, in some circumstances linking them to inflation to assist be sure that pay retains up with the price of dwelling.

But even there, most staff earn greater than the authorized minimal.

“The minimum wage is almost irrelevant,” mentioned Robert Branca, who owns almost three dozen Dunkin’ Donuts shops in Massachusetts, the place the minimal is $15. “I have to pay what I have to pay.”

As a consequence, the minimal wage has pale from the financial coverage debate. President Biden, who tried and didn’t move a $15 minimal wage throughout his first yr in workplace, now not often mentions it, though he has made the financial system the centerpiece of his re-election effort. The Service Employees International Union, which helped discovered the Fight for $15 motion more than a decade ago, has shifted its focus to different coverage levers, although it continues to assist larger minimal wages.

Opponents, too, appear to have moved on: When Pennsylvania’s House of Representatives voted this yr to boost the state’s $7.25 minimal wage to $15 by 2026, companies, a minimum of apart from seasonal industries in rural areas, shrugged. (The measure has stalled within the state’s Republican-controlled Senate.)

“Our members are not concerned,” mentioned Ben Fileccia, a senior vp on the Pennsylvania Restaurant and Lodging Association. “I have not heard about anybody being paid minimum wage in a very long time.”

The query is what’s going to occur when the labor market cools. In inflation-adjusted phrases, the federal minimal is price lower than at any time since 1949. That implies that staff in states like Pennsylvania and New Hampshire may wrestle to carry on to their latest features if employers regain leverage.

Congress hasn’t voted to boost the minimal wage since George W. Bush was president — in 2007, he signed a regulation to carry the ground to $7.25 by 2009. It stays there 14 years later, the longest period without an increase because the nationwide minimal was established in 1938.

As the federal minimal flatlined, nonetheless, the Fight for $15 marketing campaign was succeeding on the state and native ranges. Cities like Seattle and San Francisco adopted a $15 minimal wage, adopted by states like New York and Massachusetts. And whereas Republican legislatures opposed elevating minimums, voters typically overruled them: Missouri, Florida, Arkansas and different Republican-dominated states have handed will increase by poll measures up to now decade.

Nationwide, the variety of folks incomes the minimal wage fell steadily, from almost two million when the $7.25 ground took impact to about 400,000 in 2019. (Those figures omit folks incomes lower than the minimal wage, which might in some circumstances embody youngsters, folks with sure disabilities or tipped staff.)

Then Covid-19 upended the low-wage labor market. Millions of cooks, waiters, resort housekeepers and retail staff misplaced their jobs; those that stayed on as “essential workers” typically acquired hazard pay or bonuses. As companies started to reopen in 2020 and 2021, demand for items and providers rebounded a lot quicker than the availability of staff to ship them. That left corporations scrambling for workers — and gave staff uncommon leverage.

The consequence was a labor market more and more untethered to the official minimal wage. In New Hampshire, the tenth percentile wage — the extent at which 90 % of staff earn extra — was simply above $10 in May 2019. By May 2022, that determine had jumped to $13.64, and native enterprise house owners say it has continued to rise.

“Today you’re looking at $15 an hour and saying I wish that’s all we had to pay,” mentioned David Bellman, who owns a jewellery retailer in Manchester, N.H.

The unemployment fee in New Hampshire was low earlier than the pandemic; at 1.7 % in July, it’s now among the many lowest charges ever recorded wherever within the nation. Competition for staff is fierce: The Wendy’s on Mr. Bellman’s drive house from work advertises wages of $18 an hour. At his personal retailer, he’s paying $17 to $20 an hour and lately employed somebody away from the native bagel store — his son had seen that she appeared like a tough employee.

“Basically the only way to hire anybody is to take them away from somebody else,” Mr. Bellman mentioned.

New Hampshire is surrounded by states the place the minimal wage is above $13, so if Granite State employers tried to supply considerably much less, many staff may cross the border for a much bigger paycheck. But even in states like Alabama and Mississippi, the place the price of dwelling is decrease and the place few neighboring states have minimal wages above the federal customary, most employers are discovering they need to pay nicely above $7.25.

Paige Roberts, president and chief govt of the Jackson County Chamber of Commerce in Mississippi, mentioned she was “nearly laughed out of a job” when she began asking members about paying the minimal wage. Entry-level jobs there pay about $12 an hour, based on the native unemployment workplace.

In states with larger minimums, the image is extra nuanced. Faster hikes within the wage ground within the late 2010s compelled up long-stagnant wages in fields like eating places and retail. And some companies, reminiscent of summer time camps, say they’re nonetheless paying the minimal wage for entry-level staff or these in coaching. But for probably the most half, the minimums now not exert the robust upward strain on pay that they did after they have been adopted.

When New Jersey handed a minimum-wage regulation in 2019, many companies complained that the will increase have been too aggressive: The ground would rise by a minimum of a greenback an hour yearly till it hit $15 in 2024. But lately, the new job market has levitated the wage scale much more.

“Covid kind of shifted things around a bit, as did inflation,” mentioned Jeanne Cretella, whose enterprise, Landmark Hospitality, operates 14 venues in New Jersey and Pennsylvania.

Before the pandemic, dishwashers and different entry-level staff at Landmark sometimes made the minimal wage. These days, Ms. Cretella begins staff in New Jersey at $15 an hour, although the state’s minimal gained’t hit that mark till subsequent yr.

When the Fight for $15 motion started, many economists warned that elevating the minimal wage too excessive or too rapidly may result in job losses. Some research did discover modest damaging results on employment, notably for teenagers and others on the margins of the labor market. But for the most part, researchers discovered that pay went up with out widespread layoffs or enterprise failures.

Some economists nonetheless puzzled what would occur as $15 minimal wages unfold past high-cost coastal cities. But that was earlier than the pandemic reshaped the low-wage labor market.

“We’re kind of in different territory now,” mentioned Jacob Vigdor, an economist on the University of Washington who has studied the issue.

Washington has the very best statewide minimal wage, at $15.74. Yet when Mr. Vigdor lately visited Aberdeen, a small city close to the Pacific coast, all enterprise house owners needed to speak about was the right way to retain staff.

“I did not really hear a lot of concern about those minimum wages,” he mentioned. “There the concern is that they’re losing people.”

Still, economists say the minimal wage may turn into related once more when the labor market ultimately cools and staff lose bargaining energy.

David Neumark, a professor on the University of California, Irvine, mentioned states with excessive minimal wages might be at an obstacle in a recession, as a result of employers must preserve pay excessive as demand softened, probably resulting in layoffs.

Other economists have the other concern: that staff in states the place the minimal wage stays $7.25 may see their latest features evaporate after they now not have the leverage to demand extra.

“It’s as tenuous as it gets,” mentioned Kathryn Anne Edwards, a labor economist and coverage guide. “The labor market has gained ground, but policy has not cemented that territory.”

Despite the robust labor market, many staff say they barely get by.

KaSondra Wood has spent a lot of her grownup life working for the minimal wage, from the military depot the place she held her first job, incomes $5.15 an hour, to the Little Caesars the place she made $7.25 as lately as final yr.

But not anymore: This summer time, she began a job cleansing rooms at a neighborhood resort, incomes $12 an hour. Even in Oneonta, Ala., a rural space with few job alternatives, employers know higher than to attempt hiring on the minimal wage.

“They wouldn’t advertise for it, knowing they wouldn’t get anyone in there,” she mentioned.

But Ms. Wood, 38, hardly feels that she is getting forward. The resort is a 45-minute drive from her house, so fuel eats up a lot of her paycheck, regardless that she car-pools along with her mom. Groceries preserve getting dearer.

“A couple years ago, $12 an hour would’ve been killer money,” she mentioned. But now, it isn’t sufficient to pay her payments.

“I don’t ever get caught up,” she mentioned. “I’m broke by the time I get paid.”