Who would be affected by a new minimum wage policy?

Abstract

This brief describes the population who would be directly affected by the President’s proposal to increase the minimum wage to $9.00 per hour: workers earning between$7.25 and $9.00 per hour. Using data from the 2010 and 2012 Annual Social and Economic Supplement of the Current Population Survey, author Jessica Carson details the characteristics of these potentially affected earners and compares them with the hourly workforce more broadly, paying particular attention to rural-urban differences. She reports that nearly 17 percent of hourly paid workers earn between$7.25 and $9.00 per hour and would see a pay increase under the proposed minimum wage policy. The brief also shows that women, young adults, and workers who are nonwhite, never married, and less educated would disproportionately benefit from a changed policy. She concludes with a discussion of policy implications, emphasizing that to minimize potentially negative employment effects, any minimum wage legislation should be crafted with careful consideration of the implications that an increase may have for firms employing hourly workers