America's Most Poorly Paid Workers

With the recent news that California was nearly set to phase in a statewide $15-per-hour minimum wage over the next five years, I thought that it was a good time to take a look at a study by the National Employment Law Project (NELP) that looks at which Americans are earning less than the proposed $15 per hour minimum wage that has become the rallying cry for underpaid workers.  Here are some of the interesting highlights from the first part of the report which takes a statistical look at America's most modestly paid workers.

For the purposes of the study, the authors have used data from the Current Population Survey and the Occupational Employment Statistics survey which provides information on wages (both hourly and salaries), hours and earnings for all workers in the United States.  The authors note that a worker who is paid $15 an hour is equivalent to a worker who is paid an annual salary of $31,200.  Here are some surprising and not-so-surprising statistics:

1.) 42.4 percent of U.S. workers make less than $15 per hour.

2.) Female workers account for 54.7 percent of workers making less than $15 per hour while making up only 48.3 percent of the workforce.

3.) 54.1 percent of African-American and 59.5 percent of Latino workers make less than $15 per hour.

4.) 46.4 percent of workers making less than $15 per hour are aged 35 and older.

5.) Only Arkansas and Mississippi have median wages of less than $15 per hour and Tennessee, Montana, Kentucky and South Dakota all have $15 per hour median wages.

6.) Food preparation and serving occupations have the greatest concentration of workers making less than $15 per hour.

7.) Cashiers and retail salespeople are the two occupations that represent the greatest number of workers making less than $15 per hour.

8.) More than 50 percent of workers in farming, fishing, forestry, personal care and service, building and grounds cleaning and maintenance, healthcare support, sales, transportation and moving make less than $15 per hour.

9.) Six of the ten largest occupations with median wages less than $15 per hour rank among the occupations that are most likely to experience expansions in the future.

Here is a graphic showing the both the total share of workers in the workforce by demographic group (ethnicity/race and age) and share of sub-$15 per hour workforce

Here is a graphic showing the occupations with the most workers making less than $15 and the median wage for that occupation:

Let's look at the top 5 occupations with the largest share of workers making less than $15 per hour and the median wage for each occupation:

Here is a table showing the top five industries with the most workers making less than $15 per hour:

The top twenty-five industries with the most workers making less than $15 per hour employed 46,776,070 workers in 2014 or 32 percent of all U.S. civilian workers. 

Let's close this posting with a Budget Blog from the U.S. Senate website which states the following:

"We, the undersigned professional economists, favor an increase in the federal minimum wage to $15 an hour as of 2020. The federal minimum wage is presently $7.25, and was most recently increased in 2009. We also support intermediate increases over the current federal minimum between now and 2020, such as a first-step raise to $10.50 an hour as of 2016.

The real, inflation-adjusted, value of the federal minimum wage has fallen dramatically over time. The real value of the federal minimum wage peaked in 1968 at 10.85 an hour, 50 percent above the current level. Moreover, since 1968, average U.S. labor productivity has risen by roughly 140 percent. This means that, if the federal minimum wage had risen in step with both inflation and average labor productivity since 1968, the federal minimum wage today would be $26.00 an hour.

If a worker today is employed full time for a full 52-week year at a minimum wage job today, she or he is making $15,080. This is 21 percent below the official poverty line for a family of three. Raising the minimum wage to $15 an hour would deliver much needed living standard improvements to 76 million U.S. workers and their families. The average age for these workers is 36 years old and they have been in the labor force for an average of 17 years. Only 6 percent of the workers who would benefit from this minimum wage increase are teenagers; i.e., 94 percent are adults." (my bold)

   

The posting is signed by 210 economists representing a wide selection of America's most prestigious universities.  Apparently, Congress doesn't really care.