Minimum Wage Workers in Pennsylvania: 2007 (PDF)

In 2007, 69,000 hourly-paid workers in the Commonwealth of Pennsylvania had earnings at or below the Federal minimum wage¹, according to the Bureau of Labor Statistics of the U.S. Department of Labor.  More than 3.4 million workers in Pennsylvania were paid at hourly rates, representing 62 percent of all wage and salary workers².  Regional Commissioner Sheila Watkins noted that workers paid the Federal minimum wage or less³ made up 2.0 percent of all hourly-paid workers in the Commonwealth, down from 2.8 percent in 2006.  (See chart A and table 1.)

Chart A.  Employed wage and salary workers paid hourly rates with earnings at or below the prevailing Federal minimum wage in the Commonwealth of Pennsylvania, annual averages, 2000-07 (numbers in thousands)

According to Current Population Survey (CPS) estimates for 2007, 75.9 million workers in the United States were paid at hourly rates, representing 58.5 percent of all wage and salary workers.  Of those paid by the hour, 267,000 were reported as earning exactly the prevailing Federal minimum wage.  Nearly another 1.5 million were reported as earning wages below the minimum.  Together, these 1.7 million workers with wages at or below the minimum made up 2.3 percent of all hourly-paid workers in the nation.

Relative to 2006, 27,000, or 28.1 percent, fewer hourly-paid workers in Pennsylvania earned at or below the federal minimum wage in 2007, with all of the decrease occurring among workers paid at the federal minimum wage.  (See table A.)  The minimum wage in Pennsylvania increased from $5.15 per hour to $6.25 per hour on January 1, 2007, then to $7.15 per hour on July 1, 2007.  Meanwhile, the prevailing federal minimum wage was $5.15 per hour until July 24, 2007, when it rose to $5.85 per hour.

Women accounted for 72 percent (50,000) of the hourly-paid workers who earned the prevailing Federal minimum wage or less in Pennsylvania in 2007, while men accounted for the remainder (20,000). Since 2000, the number of hourly-paid workers earning the prevailing Federal minimum wage or less in the Commonwealth fell by 80,000, with women accounting for 50,000 of the decline.

Overall, employed wage and salary workers paid hourly rates in the Commonwealth had median hourly earnings⁴ of $12.21 in 2007; nationally, the median was $11.95.  The median hourly rates for men and for women in Pennsylvania in 2007 were $13.98 and $11.06, respectively.  For the U.S. as a whole, the comparable figures were $12.95 per hour for men and $10.98 per hour for women.

Among the 50 states and the District of Columbia in 2007, Mississippi, at 4.5 percent, had the highest proportion of hourly-paid workers earning at or below the prevailing Federal minimum wage, followed by Louisiana, at 4.3 percent.  Massachusetts, South Carolina, and Texas had the next highest shares, 4.0 percent each.  California, Montana, Oregon, and Washington had the lowest shares, each with less than 1 percent of hourly-paid workers earning the Federal minimum or below.   It should be noted that as of January 1, 2008, 32 states and the District of Columbia had laws establishing minimum wage standards that exceeded the Federal level of $5.85 per hour.  Three of these states have enacted the laws since March 2007.⁵ These new levels went into effect on September 1, 2007, for New Hampshire and January, 1, 2008, for Iowa and New Mexico.  (See table 1 and chart B.)

Chart B.  Minimum wage laws in the States, January 1, 2008

Source: U.S. Employment Standards Administration, Wage and Hour Division

Technical Note

The Bureau of Labor Statistics' data on minimum wage earners are derived from the Current Population Survey (CPS), a nationwide sample survey of households that includes questions enabling the identification of hourly-paid workers and their hourly wage rate.  Data in this summary are annual averages.

Minimum wage worker data, particularly levels, for each year are not strictly comparable with data for earlier years because of the introduction of revised population controls used in the CPS.  The effect of the revised population controls on the minimum wage earner estimates is unknown.  However, the effect of the new controls in 2007 on the monthly CPS estimates for the U.S. was to increase the December 2006 employment level by 153,000 and the unemployment level by 10,000.  The updated controls had little or no effect on unemployment rates and other ratios.  For additional information, see "Adjustments to Household Survey Population Estimates in January 2007" in the February 2007 issue of Employment and Earnings, available on the Internet at www.bls.gov/cps/cps07adj.pdf.

It should be noted that the presence of a sizable number of workers with reported wages below the minimum does not necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law.  The estimates of the numbers of minimum and subminimum wage workers presented in the accompanying tables pertain to workers paid at hourly rates; salaried and other non-hourly workers are excluded.  As such, the actual number of workers with earnings at or below the prevailing minimum is undoubtedly understated.  Research has shown that a relatively smaller number and share of salaried workers and others not paid by the hour have earnings that, when translated into hourly rates, are at or below the minimum wage.  However, BLS does not routinely estimate hourly earnings for non-hourly workers because of data concerns that arise in producing these estimates.  For further information, see Steven Haugen and Earl Mellor, "Estimating the number of minimum wage workers," Monthly Labor Review, January 1990 at www.bls.gov/opub/mlr/1990/01/rpt1full.pdf.

The prevailing Federal minimum wage was $2.90 in 1979, $3.10 in 1980, and $3.35 in 1981-89.  The minimum wage rose to $3.80 in April 1990, $4.25 in April 1991, $4.75 in October 1996, and $5.15 in September 1997.  On July 24, 2007, the Federal minimum wage increased to $5.85 per hour from $5.15 per hour. Data in this 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).

For personal assistance or further information on minimum wage workers, as well as other Bureau data, contact the Mid-Atlantic Information Office at 215-597-3282 from 8:30 a.m. to 12:00 p.m. and 1:00 p.m. to 3:30 p.m. ET.  Information on the Current Population Survey and other surveys and programs is available on our Web site at www.bls.gov/ro3/.  Information in this release will be made available to sensory impaired individuals upon request.  Voice phone: 202-691-5200, TDD message referral phone number: 1-800-877-8339.