Characteristics of Minimum Wage Workers: 2008

According to Current Population Survey estimates for 2008, 75.3 million American workers age 16 and over were paid at hourly rates, representing 58.2 percent of all wage and salary workers.1 On July 24, 2008, the Federal minimum wage increased to $6.55 per hour from $5.85 per hour. Data in this report reflect the average number of workers earning the prevailing Federal minimum wage or less for the year (those who earned $5.85 or less from January 2008 through July 2008 and those who earned $6.55 or less from August 2008 through the end of the year). Among those paid by the hour, 286,000 earned exactly the prevailing Federal minimum wage in 2008. About 1.9 million had wages below the minimum.2 Together, these 2.2 million workers with wages at or below the minimum made up 3.0 percent of all hourly-paid workers. Tables 1-10 present data on a wide array of demographic and socioeconomic characteristics for hourly-paid workers earning at or below the Federal minimum wage. The following are some highlights from the 2008 data.

  • Minimum wage workers tend to be young. Although workers under age 25 represented only about one-fifth of hourly-paid workers, they made up half of those paid the Federal minimum wage or less. Among employed teenagers paid by the hour, about 11 percent earned the minimum wage or less, compared with about 2 percent of workers age 25 and over. (See table 1 and table 7.)


  • About 4 percent of women paid hourly rates had wages at or below the prevailing Federal minimum, compared with about 2 percent of men. (See table 1.)


  • The percentage of workers earning the minimum wage did not vary much across the major race and ethnicity groups. About 3 percent of white, black, and Hispanic hourly-paid workers earned the Federal minimum wage or less. Among Asian hourly-paid workers, about 2 percent earned the minimum wage or less. (See table 1.)


  • Among hourly-paid workers age 16 and over, about 5 percent of those who had less than a high school diploma earned the Federal minimum wage or less, compared with about 3 percent of those who had a high school diploma (with no college) and about 2 percent of college graduates. (See table 6.)


  • Never-married workers, who tend to be young, were more likely than married workers to earn the Federal minimum wage or less (about 5 percent versus about 2 percent). (See table 8.)


  • Part-time workers (persons who usually work less than 35 hours per week) were more likely than their full-time counterparts to be paid the Federal minimum wage or less (about 7 percent versus about 2 percent). (See table 1 and table 9.)


  • By major occupational group, the highest proportion of workers earning at or below the Federal minimum wage was in service occupations, about 9 percent. About 7 in 10 workers earning the minimum wage or less in 2008 were employed in service occupations, mostly in food preparation and serving related jobs. (See table 4.)


  • The industry with the highest proportion of workers with hourly wages at or below the Federal minimum wage was leisure and hospitality (about 14 percent). About three-fifths of all workers paid at or below the Federal minimum wage were employed in this industry, primarily in the food services and drinking places component. For many of these workers, tips and commissions supplement the hourly wages received. (See table 5.)


  • Among the States, Mississippi, South Carolina, Tennessee, and Oklahoma had the highest proportions of hourly-paid workers earning at or below the Federal minimum wage (about 6 percent). The percentage of workers earning at or below the Federal minimum wage was lowest (1 percent or less) in Alaska, California, and Oregon. It should be noted that some states have minimum wage laws establishing standards that exceed the Federal minimum wage. (See table 2 and table 3.)


  • The proportion of hourly-paid workers earning the prevailing Federal minimum wage or less has trended downward since 1979, when data first began to be collected on a regular basis. (See table 10.)


Source: U.S. Department of Labor, Bureau of Labor Statistics. Bureau of Labor Statistics data on minimum wage earners are derived from the Current Population Survey (CPS), a nationwide sample survey of households that includes questions enabling the identification of hourly-paid workers and their hourly wage rate. Data in this summary are 2008 annual averages.

1 Data are for wage and salary workers age 16 and over and refer to earnings on a person's sole or principal job. All self-employed persons are excluded whether or not their businesses are incorporated.

2 It should be noted that the presence of a sizable number of workers with wages below the minimum does not necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law. The estimates of the numbers of minimum and subminimum wage workers presented in the accompanying tables pertain to workers paid at hourly rates; salaried and other non-hourly workers are excluded. As such, the actual number of workers with earnings at or below the prevailing Federal minimum is undoubtedly understated. Research has shown that a relatively smaller number and share of salaried workers and others not paid by the hour have earnings that, when translated into hourly rates, are at or below the minimum wage. However, BLS does not routinely estimate hourly earnings for non-hourly workers because of data concerns that arise in producing these estimates. For further information, see Steven Haugen and Earl Mellor, "Estimating the number of minimum wage workers," Monthly Labor Review, January 1990 (PDF 415K).


Characteristics of Minimum Wage Workers: 2008, Tables 1 - 10

Characteristics of Minimum Wage Workers: 2008 (PDF)


 

Last Modified Date: September 12, 2016