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Here’s What the Minimum Wage Workforce Looks Like Right Now in the U.S.
A battle is raging in Seattle right now over a recent increase in the minimum wage.
Well, sort of.
A group of researchers hired by the city to study the ripple effects of efforts to raise the minimum wage to $15 found the move increased unemployment and actually hurt the lowest-wage workers: Those in the service industry.
Now it’s a fight over who’s right: Jacob Vigdor and the University of Washington team that conducted the study or a vocal group of outside economists who dispute its findings. There’s not going to be an easy answer, since Vigdor had access to private data that isn’t publicly available.
The minimum wage uproar has spilled into other parts of the country as well, with St. Louis actually lowering its mandated pay level from $10 to $7.70.
As a recovering economist, I can tell you that practically any policy issue — especially divisive ones — will have studies supporting either side. And speaking of divisive, at least a half-dozen economists I contacted declined to comment on the current minimum wage discussion, citing concerns over its controversy.
But let’s dig into the facts we can look at: Who are minimum wage workers in America and where do they live?
The Minimum Wage Worker Circa 2016
When you picture the average minimum wage worker, what do you think of? Is it Judge Reinhold as Brad Hamilton in “Fast Times at Ridgemont High,” throwing out french fries at All-American Burger?
The Penny Hoarder looked at how the breakdown of minimum wage workers has changed between 2006 and 2016 and found the share of 16- to 24-year-olds working minimum wage jobs has fallen by nearly 25% during the last decade.
Once the majority, young folks just aren’t working these types of jobs the way they had in the past, according to U.S. Bureau of Labor Statistics data.
The share of 16- to 24-year-olds working jobs with this pay is near its lowest point in 15 years: 45%.
Meanwhile, the share of those older than 24 living on minimum wage stood at 55% last year.
While the reasons for the change vary (summer jobs just don’t seem to pay off for teens anymore), former President Barack Obama tried unsuccessfully to push Congress to increase the minimum wage in 2014 and 2015.
“Right now, there’s a bill that would boost America’s minimum wage to $10.10 an hour. That would lift wages for nearly 28 million Americans across the country. 28 million,” Obama said in 2014. “And we’re not just talking about young people on their first job.”
Indeed, minimum wage workers of all ages are having trouble finding housing right now.
Regardless of what the federal government does, 20 U.S. states enacted — or will enact — minimum wage hikes this year, affecting more than 4 million workers. But last year, which states had the highest concentration of workers making the federal minimum wage?
Kentucky, Louisiana, Idaho, Mississippi and South Carolina had the highest ratio of their workforces on minimum wage in 2016. Louisiana and Kentucky and fourth and seventh highest unemployment rates as of May 2017.
There are definitely no easy answers when it comes to what to do about the minimum wage. Penny Hoarder staff writer Lisa McGreevy even compared it to a no-win training scenario from Star Trek.
Who knows what the demographic breakdown of the minimum wage workforce will be in another decade? But should it continue to trend older, should the minimum wage rise as well?
With economists effectively deadlocked on the issue, it’ll be up to public opinion to decide what happens in the coming years.
Alex Mahadevan is a data journalist at The Penny Hoarder.
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