econscius

Minimum Wage Workers: 5.4% of Texas Workforce

In Inequality, Job Creation, Minimum Wage, Texas on January 28, 2012 at 10:57 pm

Some left-leaning websites state Texas is heavy with minimum wage jobs.  I looked and using data from the US government’s Bureau of Labor Statistics, the proportion earning at or below the actual minimum wage rate in Texas is only about 5.4%. [1]  Hardly scandalous.

Furthermore, minimum wage workers tend to be young, with a full one-quarter of all teenagers earning minimum wage (full disclosure: that was me, once upon a time!). [2]  The average age in the US 2010 Census was 37.2.   The average age in Texas was 33.6, making it the second youngest state of 51 (including DC). [3]  This means we would expect Texas to be unusually high on minimum wage workers.

Texas has lower taxes (on income tax, actually) and a lower cost of living so a minimum wage worker in Houston lives much better than a minimum wage worker in a similar sized metro area like San Francisco.

For more on impressive job growth in Texas, see my posts https://econscius.wordpress.com/2011/09/03/stellar-texas-job-growth-in-above-average-wage-cities/, https://econscius.wordpress.com/2011/09/11/stellar-job-growth-in-high-wage-austin-texas/, and https://econscius.wordpress.com/2011/10/06/astronomical-job-growth-in-houston-texas/.

 

 

Footnotes:

[1] Calculation:  according to the BLS, 550,000 Texas hourly workers were at or below the minimum wage (http://www.bls.gov/ro6/fax/minwage_tx.htm) but there were 10,089,870 total workers in the state of Texas (http://www.bls.gov/oes/current/oes_tx.htm#00-0000), indicating only about 5.4% of workers were minimum wage.   Note the BLS tends to discuss minimum wage in terms of hourly workers, rather than total workers, for the obvious reason salaried workers are almost never at, or even close to, the minimum wage.  Nearly half of Texas workers are salaried.

Note: some workers, for example restaurant wait staff, may legally be paid below the minimum wage.

[2] Quoting directly from the BLS: 

“Minimum wage workers tend to be young. Although workers under age 25 represented only about one-fifth of hourly-paid workers, they made up about half of those paid the Federal minimum wage or less. Among employed teenagers paid by the hour, about 25 percent earned the minimum wage or less, compared with about 4 percent of workers age 25 and over.” (http://www.bls.gov/cps/minwage2010.htm)

[3] http://www.census.gov/prod/cen2010/briefs/c2010br-03.pdf

Pictures from Wikipedia Commons (Austin, TX skyline & San Antonio, TX Riverwalk).

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