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Saturday, November 22, 2014

Where near-minimum-wage workers work, and how much they make

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As Fact Tank noted earlier this month, about 20.6 million people — 30% of all hourly, non-self-employed workers 18 and older — are what we call “near-minimum-wage workers,” meaning they earn more than the current minimum wage (either the federal $7.25-an-hour minimum or a higher state minimum) but less than the $10.10 hourly rate that emerged over the past year as a consensus goal of many Democrats and labor groups.

We first explored the demographics of this group by workers’ age, sex and race. But we also wondered what jobs they held and how much they earned, so we took another run through the public-use microdata from the 2013 Current Population Survey.

restaurant workers most near minimum wage
restaurant workers most near minimum wage

As you might have guessed, the restaurant and food service industry is the single biggest employer of near-minimum workers. Last year, according to our analysis, that industry employed 3.75 million near-minimum workers, about 18% of the total. Many of those workers, presumably, are tipped, so their actual gross pay may be above $10.10 an hour. (Federal law, as well as wage laws in many states, allow tipped employees to be paid less as long as “tip credits” bring their pay up to at least the applicable minimum.)

Restaurant/food service is by far the leading employer of near-minimum workers aged 30 and younger: about 2.5 million, or nearly a quarter of all near-minimum workers in that age bracket. The industry, in fact, is...

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