During 2012 and 2013, fast-food workers walked off their jobs, first in New York, then nationwide, in what was one of the first mass-scale labor actions in the United States in most adults’ lifetimes. The workers’ message was they simply cannot survive on their meager paychecks. They called on the nation’s fast-food chains to raise their pay to $15 per hour, and to sit down with them as a union to work together to improve their jobs and the industry.
In the intervening two years, the fight for $15 has grown from a rallying cry to a diverse movement. Retail workers for Walmart and other chains, home care and child-care workers, convenience-store and dollar-store workers, adjunct university faculty and others have joined strikes to demand a raise to $15 per hour—just over $31,000 for a full-time employee.
The call for a $15 wage has also palpably shifted the national conversation around income inequality and created momentum for much more meaningful action to raise the minimum wage. As a result, over the past two years, the levels of proposed minimum wage increases across the nation have jumped markedly. Growing numbers of cities are approving $15 minimum wages. At the state level, New York approved the first state $15 minimum wage for fast-food workers, and New York and California now appear poised to adopt the first statewide $15 minimum wages for all workers in 2016. And nationally, growing numbers of congressional progressives and candidates are backing legislation to phase the federal minimum wage up to $15.
The $15 movement is making great strides in winning the hearts and minds of the average American, as illustrated by recent polls showing strong and growing public support for $15 minimum wage rates; the wave of successful policy campaigns raising minimum wages at the state and local levels; and the spread of campaigns calling for $15 wages.
More broadly, since November 2012, the grassroots momentum generated by the $15 movement has helped to push through dozens of state and local minimum wage policies, raising wages for millions of workers.1 It has spurred some of our nation’s largest low-wage employers, including Walmart, McDonald’s, T.J. Maxx, and the Gap, to announce modest pay increases for their lowest-paid workers. And it has led growing numbers of leading companies, from Aetna to Facebook to Amalgamated Bank, to raise pay scales for their employees and/or contracted workers to the $15 level.
As the movement for $15 continues to gain momentum, the potential benefits for the U.S. workforce and economy are significant. This report provides wage and demographic figures on the substantial swath of the U.S. workforce that today earns less than $15 per hour, profiles notable recent victories in the $15 movement, and offers action recommendations for federal, state, and local policymakers and private-sector leaders.
In Part 1 of this report, we look at the portion of the U.S. workforce that currently earns less than $15 per hour in the United States. Our findings include the following:
- Forty-two (42) percent of U.S. workers make less than $15 per hour.
- Women and people of color are overrepresented in jobs paying less than a $15 wage. Female workers account for 54.7 percent of those making less than $15 per hour while making up less than half of the overall U.S. workforce (48.3 percent). African Americans make up about 12 percent of the total workforce, and they account for 15 percent of the sub-$15-wage workforce. Similarly, Latinos constitute 16.5 percent of the workforce, but account for almost 23 percent of workers making less than $15 per hour.
- More than half of African-American workers and close to 60 percent of Latino workers make less than $15.
- About half (46.4 percent) of workers making less than $15 per hour are ages 35 and older.
- Cashiers and retail salespersons are the two occupations that represent the greatest number of workers making less than $15 per hour. Almost three million people working as cashiers and two million people working as retail salespersons fall in that category.
- Food preparation and serving occupations have the greatest concentration of workers making less than a $15 wage. Other occupation groups in which such jobs are concentrated include farming, fishing, and forestry; personal care and service; building and grounds cleaning and maintenance; healthcare support; sales; and transportation and moving. In these occupations, more than 50 percent of workers make less than $15 per hour.
- Six out of the ten largest occupations with median wages less than $15 also rank among the occupations projected to add the most jobs in coming years. These are retail salespersons; combined food preparation and serving workers, including fast food; laborers and freight, stock, and material movers, hand; janitors and cleaners, except maids and housekeeping cleaners; nursing assistants; and personal care aides.
- The top industries for sub-$15 work are food services and drinking places, private households, agriculture, personal and laundry services, hotel/motel accommodation, retail trade, and administrative and support services. In these industries, more than 60 percent of workers make less than $15 per hour.
In Part 2, we take a closer look at the largest front-line occupations in six industries—restaurants/bars, retail, child care, auto manufacturing, home care, and hotels—and find the following:
- Even after accounting for tips, more than four out of five (83.8 percent) front-line workers in all food service and drinking places make less than a $15 wage.
- The overwhelming majority—96 percent—of fast-food workers make less than $15 an hour.
- Four out of five workers in both retail and hotel/motel accommodation front-line occupations make less than $15 per hour.
- Automotive manufacturing jobs have long been seen as well paid, but we find that about half of front-line automotive manufacturing workers make below $15.
- Almost 90 percent of people working in home care and child care make less than $15 per hour.
- Front-line, low-wage jobs in these industries are predominately filled by women. A majority of workers in these occupations—more than 70 percent of front-line workers in fast food, 74 percent in hotel/motel accommodation, and 53 percent in retail—are female.
- Although front-line retail jobs are often seen as jobs held by young people, almost half of workers in these occupations are age 35 or older.
- Unionization rates are low—ranging from about 2 to 10 percent—for front-line workers in these industries, with the exception of auto manufacturing, in which more than one in four workers are union.
In Part 3, we review recent economic analysis of $15 wages, profile the experiences of localities and employers that are transitioning to that level, and give an overview of recent and current $15 wage policy campaigns. We find the following:
- Cost-of-living analyses show that, just about everywhere in the United States, a single low-wage worker needs $15 an hour to cover basic living costs—and that in higher-cost states and regions, workers supporting families need much more.2
- Both economic analysis and the experiences of localities and employers that have raised wages significantly suggest that pay in the affected jobs can be upgraded to $15—with far-reaching benefits for America’s workers. For example, more than 200 economists have advised that “raising the federal minimum to $15 an hour by 2020 will be an effective means of improving living standards for low-wage workers and their families and will help stabilize the economy.”3
- State-of-the-art economic modeling of the impact a $15 wage on employers and jobs—conducted by University of California researchers under contract with the City of Los Angeles—finds that the measure would raise pay for approximately 41 percent of the workforce by an average of $4,800 per worker per year, and have very little adverse impact on employment levels.4
- Los Angeles, Seattle, San Francisco, and other cities have all adopted $15 minimum wages; New York approved the first state-level $15 wage for fast-food workers; New York and California appear likely to enact the first statewide $15 minimum wages in 2016; and more cities and states, including Washington, D.C. and Massachusetts (for fast-food and retail workers in large stores), are proposing to follow their lead.
- Private-sector employers, such as insurance giant Aetna, Facebook, Amalgamated Bank, the university-affiliated hospital Johns Hopkins Medicine, and academic institutions such as the University of Rochester, the University of California, and Duquesne University, have also raised base pay to $15 per hour or more for their workers and/or their contractors.
Finally, in Part 4, we offer concrete recommendations for action by federal, state, and local policymakers, and private-sector leaders seeking to continue shifting our economy back toward better-paying jobs. Those recommendations include the following:
- Having more cities follow the lead of Los Angeles, San Francisco, and Seattle by raising the minimum wage to $15 at the local level, with phase-ins appropriate for their local costs of living and economies.
- Helping the $15 movement jump to the state level, with New York and California leading the way, by adopting the nation’s first statewide $15 minimum wages.
- Building support for a phased-in $15 federal minimum wage, as proposed by S. 1831/H.R. 3164.5
- Adopting $15 minimum wages for key low-wage industries such as fast food, large retail, hotels, caregiving, property services, and airport workers, as several cities and two states (New York for fast-food workers and Massachusetts for Medicaid-funded home care workers) have done.
- Issuing executive orders or enacting wage laws raising the minimum wage to $15 for businesses receiving taxpayer-funded contracts or subsidies. A growing number of mayors are taking such action, and President Obama should do the same by issuing a “model employer” executive order, as called for by the Good Jobs Nation campaign, encouraging the federal government to do business with contractors that pay their employees at least $15 per hour and provide stable, quality jobs.6
- Raising wages for low-paid city, state, or federal employees to $15, as growing numbers of public bodies are doing.
- Raising private-sector pay scales to $15, as employers large and small have done.