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Thursday, September 10, 2015
Of the 1,144,000 workers paid hourly rates in Kentucky in 2014, 26,000 earned exactly the prevailing federal minimum wage of $7.25 per hour, while 30,000 earned less, the U.S. Bureau of Labor Statistics reported today. Regional Commissioner Janet S. Rankin noted that the 56,000 workers earning the federal minimum wage or less made up 4.9 percent of all hourly paid workers in the state. Nationwide, those earning the federal minimum or less accounted for 3.9 percent of the hourly paid workforce. (The Kentucky minimum wage is equal to the prevailing federal minimum wage.)
In 2006, 26,000 hourly paid workers earned the prevailing federal minimum wage or less in Kentucky, the lowest level since data were first available in 2000. The 26,000 workers in this category accounted for 2.2 percent of all hourly paid workers in the state. (See chart 1.) In 2007, the federal minimum wage began increasing after holding steady for nearly a decade. Two additional increases in the federal minimum wage followed, resulting in more Kentucky workers falling into this category, peaking at 91,000 in 2010. That number has fallen in three of the last four years since the peak.
From 2013 to 2014, the portion of hourly paid workers in Kentucky who earned at or below the federal minimum wage increased from 4.3 to 4.9 percent. The percentage of workers earning less than the federal minimum rose 1.1 percentage points in 2014 to 2.6 percent, while the share earning exactly the minimum wage fell 0.5 percentage point to 2.3 percent. (See table 1.)
Of the 56,000 workers earning the federal minimum wage or less in Kentucky in 2014, 35,000, or 63 percent, were women. These women represented 5.9 percent of all women paid hourly rates in the state. There were 22,000 men earning the minimum wage or less in Kentucky, accounting for 4.0 percent of all men paid hourly rates in the state.
In 2014, Kentucky’s proportion of hourly paid workers earning at or below the federal minimum wage ranked 15th among the 50 states and the District of Columbia. The states with the highest percentages of hourly paid workers earning at or below the federal minimum wage were Arkansas, Indiana, Louisiana, Mississippi, and Tennessee (all between 6 percent and 7 percent). The states with the lowest percentages of hourly paid workers earning at or below the federal minimum wage were Alaska, California, Oregon, and Washington (all between 1 percent and 2 percent). It should be noted that some states have minimum wage laws establishing standards that exceed the federal minimum wage. As of January 1, 2015, 29 states and the District of Columbia had laws establishing minimum wage standards that exceeded the federal level of $7.25 per hour. (See table 2 and chart 2.)
Overall, wage and salary workers earning hourly rates in the state had median hourly earnings of $12.88 in 2014; nationally, the median was $13.14. The median hourly rates for men and women in Kentucky in 2014 were $14.31 and $12.12, respectively. (See table 1.) For the nation, the comparable figures were $14.39 per hour for men and $12.18 per hour for women.
The estimates in this release were obtained from the Current Population Survey (CPS), which provides information on the labor force, employment, and unemployment. The survey is conducted monthly for the U.S. Bureau of Labor Statistics (BLS) by the U.S. Census Bureau using a scientifically selected national sample of about 60,000 eligible households in all 50 states and the District of Columbia. The survey also provides data on earnings, which are based on one-fourth of the CPS monthly sample and are limited to wage and salary workers.
Statistics based on the CPS are subject to both sampling and nonsampling error. The differences among data for the states reflect, in part, variations in the occupation, industry, and age composition of each state’s labor force. In addition, sampling error for the state estimates is considerably larger than it is for the national data.
Minimum wage worker data, particularly levels, for each year are not strictly comparable with data for earlier years because of the introduction of revised population controls used in the CPS. For technical documentation and related information, including reliability of the CPS estimates, see www.bls.gov/cps/documentation.htm.
It should be noted that the presence of workers with reported wages below the federal minimum wage does not necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law. Estimates of the number of minimum wage workers in this release pertain only to workers who are paid hourly rates. Salaried workers and other workers who are not paid by the hour are excluded, even though some have earnings that, if converted to hourly rates, would be at or below the federal minimum wage. Consequently, the estimates presented in this release likely understate the actual number of workers with hourly earnings at or below the minimum wage.
The prevailing federal minimum wage was $2.90 in 1979, $3.10 in 1980, and $3.35 in 1981-89. The minimum wage rose to $3.80 in April 1990, $4.25 in April 1991, $4.75 in October 1996, and $5.15 in September 1997. On July 24, 2007, the federal minimum wage increased to $5.85 per hour; on July 24, 2008, to $6.55 per hour; and on July 24, 2009, to $7.25 per hour.
The principal definitions used in connection with the earnings series in this release are described below:
Median hourly earnings. The median is the amount which divides a given earnings distribution into two equal groups, one having earnings above the median and the other having earnings below the median. The median is less sensitive to extreme wages than the mean; this makes it a better measure for highly skewed distributions.
Wage and salary workers. Workers age 16 and older who receive wages, salaries, commissions, tips, payments in kind, or piece rates on their sole or principal job. This group includes employees in both the private and public sectors. All self-employed workers are excluded whether or not their businesses are incorporated.
Information in this release will be made available to sensory impaired individuals upon request. Voice phone: 202-691-5200; Federal Relay Service: 1-800-877-8339.
|Kentucky||Number of workers (in thousands)||Percent of workers paid hourly rates||Median earnings (in dollars)|
|Total paid hourly rates||At or below minimum wage||At or below minimum wage|
|Total||At minimum wage||Below minimum wage||Total||At minimum wage||Below minimum wage|
|Total, both sexes|
Note: Data excludes all self-employed persons whether or not their businesses are incorporated. Some numbers may not sum to totals due to rounding.
|State||Number of workers (in thousands)||Percent distribution||Percentage of workers paid hourly rates|
|Total paid hourly rates||At or below minimum wage||Total paid hourly rates||At or below minimum wage||At or below minimum wage|
|Total||At minimum wage||Below minimum wage||Total||At minimum wage||Below minimum wage||Total||At minimum wage||Below minimum wage|
Total, 16 years and older
District of Columbia
Note: Data exclude all self-employed persons whether or not their businesses are incorporated. These data are based on a sample and therefore are subject to sampling error; the degree of error may be quite large for less populous states.
Last Modified Date: Thursday, September 10, 2015