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This report includes a summary of key changes, including the salary level test and salary basis test.

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April 02, 2008
Who Earns the Minimum Wage?

Among the 75.9 million American workers who were paid by the hour last year, 267,000 earned exactly the prevailing federal minimum wage, and nearly 1.5 million earned wages below the minimum, according to a report by the Department of Labor's Bureau of Labor Statistics.

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On July 24, 2007, the federal minimum wage increased to $5.85 per hour from $5.15 per hour. Data in the report reflect the average number of workers earning the prevailing federal minimum wage or less for the year (those who earned $5.15 or less from January 2007 through July 2007 and those who earned $5.85 or less from August 2007 through the end of the year).

Together, these 1.7 million workers with wages at or below the minimum made up 2.3 percent of all hourly-paid workers.

Minimum wage workers tend to be young. Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up almost half of those paid the federal minimum wage or less. Among employed teenagers paid by the hour, about 7 percent earned the minimum wage or less, compared with fewer than 2 percent of workers age 25 and over.

Women are more likely to earn the federal minimum wage or less. About 3 percent of women paid by the hour reported wages at or below the prevailing federal minimum, compared with about 1 percent of men.

The bureau notes that the presence of a sizable number of workers with reported wages below the minimum doesn't necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law.

The federal minimum wage is scheduled to increase to:

  • $6.55 per hour on July 24, 2008 and
  • $7.25 per hour on July 24, 2009
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