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by

Gregory Acs
The Urban Institute
2100 M Street NW
Washington, DC 20037

May 1999

Abstract

This paper profiles the low-wage workforce in 1997. I find that over one-quarter of all workers earned less than $7.50 an hour, but only one in ten workers is a low-wage worker in a family whose income falls below $24,600 a year. And only one in twenty workers are low-wage workers in low-income families with children. Thus, while low-wage workers comprise a significant share of the workforce, most low-wage workers are younger and secondary earners. To the extent that concern for low-wage workers is based on concern for low-income families with children, policies aimed at low-wage workers in general are likely to be poorly targeted. Policies aimed at helping low-income families, many of whom have low-wage workers, may prove to be more cost effective.

Brief Description

This paper examines the characteristics of low-wage workers. It finds that over one-quarter of all workers earned less than $7.50 an hour in 1997, but only one out of ten workers were low-wage workers in low-income families. Compared to all workers, low-wage workers work fewer hours, completed less schooling, are younger, and are more likely to work in retail trade, live in the South and in rural areas, and be recent immigrants.

Tables

Table 1: Share of All Workers Who Are Low-Wage, Low-Income, Low-Wage/Low Income, and Low-Wage/Low-Income with Children

Table 2: Proportion of Total Family Income Comprised by Worker Earning by Worker Type

Table 3: Family Composition by Worker Type

Table 4: Probability of Being a Low-Wage Worker and a Low-Wage/Low-Income Worker by Family Composition

Table 5: Work Effort by Worker Type

Table 6: Educational Attainment by Worker Type

Table 7: Probability of Being a Low-Wage Worker, a Low-Wage/Low-Income Worker, and a Low-Wage/Low-Income Worker with Children by Educational Attainment

Table 8: Geographic Distribution of Workers by Worker Type

Table 9: Occupational and Industry Distribution of Workers by Worker Type

Table 10: Probability of Being a Low-Wage Worker and a Low-Wage/Low-Income Worker by Race, Ethnicity, Citizenship, and Immigration Status

Table 11: Race, Ethnicity, and Immigration Status of Workers

Table 12: Age of Workers

Figures

Figure 1: Share of Workers Who Are Low Wage

Figure 2: Proportion of Total Family Income for Low-Wage Workers

Figure 3: Proportion of Total Family Income for Low-Wage/Low-Income Workers

Figure 4: Proportion of Total Family Income for Low-Wage/Low-Income Workers with Children

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