64% Earning At/Below Minimum Wage Are Under 30; 63% Work in Restaurants, Bars, Retail

February 17, 2014 - 3:59 PM

Bartender

(AP Photo)

(CNSNews.com) - Sixty-four percent of Americans who earned the minimum wage or less in 2013 were 29 years old or younger, according to new data from the Bureau of Labor Statistics, and 63 percent worked in restaurants, bars or retail.

People 30 years or older equaled only about 36 percent of those who earned the minimum wage or less in 2013--and only 0.8 percent of the people employed in the United States.

President Barack Obama has made one of his key economic initiatives for this year an effort to get Congress to increase the federal minimum wage from $7.25 per hour to $10.10 per hour.

In 2013, according to the Bureau of Labor Statistics, there were 143,929,000 people employed in the United States during the average month. Of those, 75,948,000—or 52.8 percent--were paid an hourly rate.

Of the 75,948,000 who were paid an hourly wage in 2013, 3,300,000 earned at or below the minimum wage.

That means only about 4.4 percent (3,300,000) of hourly wage earners (75,948,000) earned the minimum wage or less in 2013--or only about 2.3 percent (3,300,000) of all U.S. employees (143,929,000).

But the 2.3 percent of American employees paid at or below the minimum wage in 2013 was not evenly distributed across age groups and industries.

50.4 percent—1,663,000—earning at or below the minimum wage were 24 years old or younger.

Another 436,000 were from 25 to 29 years of age. That means 63.6 percent—or 2,099,000—of the workers earning at or below the minimum wage in 2013 were 29 years old or younger.

The 1,201,000 employees who were 30 years or older and earned the minimum wage or less equaled 36.4 percent of those who earned the minimum wage or less--and only 0.8 percent of the 143,929,000 employed in the United States.

Where did Americans earning at or below the minimum wage work?

The industry that employed the largest number of workers at or below the minimum wage in 2013, according to BLS, was the “food services and drinking places” industry.

“Industries in the Food Services and Drinking Places subsector prepare meals, snacks, and beverages to customer order for immediate on-premises and off-premises consumption,” says BLS. This included “full service restaurants,” “limited-service eating places,” “special food services,” and “drinking places (alcoholic beverages).”

In 2013, according to BLS, businesses of this type employed 1,610,000 people at or below the minimum wage. That means 48.78 percent of all workers earning at or below the minimum wage were working in restaurants and bars.

This industry, according to the BLS, employed 10,503,600 people in January at an average hourly wage of $12.37. But it had an unemployment rate of 9.3 percent—41 percent above the national unemployment rate of 6.6 percent.

The industry that employed the second largest number of people at or below the minimum wage was the “retail trade industry,” which, according to BLS, “comprises establishments engaged in retailing merchandise, generally without transformation, and rendering services incidental to the sale of merchandise.”

This “retail trade” industry employed a total of 15,259,500 people in January and had an unemployment rate of 8.5 percent—or about 29 percent above the national rate of 6.6 percent.

468,000 of the people employed in the retail trade industry in 2013, according to BLS, made at or below the minimum wage.

The combined 2,078,000 peoplewho earned at or below the minimum wage working in restaurants, bars and retail in 2013 equaled 62.96 percent of the overall total of 3,300,000 who earned at or below the minimum wage.

“The presence of a sizable number of workers with wages below the federal minimum does not necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law,” says BLS in its annual report for 2012 on the characteristics of people earning the minimum wage.

For example, explains the Congressional Research Service, “a ‘tipped employee’—a worker who ‘customarily and regularly receives more than $30 a month in tips’—may have his or her cash wage from an employer reduced to $2.13 per hour, as long as the combination of tips and cash wage from the employer equals the federal minimum wage.”

Of the 1,610,000 workers who made at or below the minimum wage working in the “food services and drinking places” industry in 2013, 1,079,000 were paid below the prevailing minimum wage, and 531,000 were paid at the minimum wage.

Also, according to CRS, employers can be certified by the Department of Labor “to pay full-time students who are employed in retail or service establishments, an agricultural occupation, or an institution of higher education a wage at least 85% of the federal minimum wage ($6.16 at the current minimum wage).”