Characteristics of Low-Wage Workers and Their Labor Market Experiences: Evidence from the Mid- to Late 1990s. What are the Job and Overall Employment Characteristics of Low-Wage Workers?

04/30/2004

Several studies examine, in varying detail, the characteristics of jobs held by the population of low-wage workers and their overall employment characteristics (Acs et al. 2001; Bernstein and Hartmann 1999; Carnevale and Rose 2001; Mishel et al. 2001; and Mitnik et al. 2002). These studies focus on such characteristics as annual hours and weeks worked (in the low-wage job and in all jobs), job tenure, number of jobs held, benefits available on the job, and job occupations and industries. However, except for Acs et al. (2001), none of these studies examine the full range of job characteristics.(5)

The studies indicate that most low earners receive low hourly wages and are not full-time, full-year workers. In addition, the jobs that low-wage workers hold provide fewer benefits than the jobs that higher-wage workers hold, and low-wage workers have substantially less job tenure than higher-wage workers. Low-wage workers are represented in all occupations and all industries, but they are found disproportionately in retail trade industries, low-end service and sales occupations, and nonunion jobs (Acs [1999]; Bernstein and Hartmann [2000]; Carnevale and Rose [2001]; Mitnik et al. [2002]; Mishel et al. [2001]; and Osterman [2001]).

A large literature exists demonstrating that real wages of low-skilled workers (especially males) declined between the early 1970s and the mid-1990s, which suggests that the economic circumstances of workers in the low-wage sector worsened during this period (Blank 1994; Card and Blank 2000; Gottschalk 1997; and Mishel et al. 2001). For example, the real wages of males with wages at the 20th percentile of the wage distribution declined by about 20 percent between 1973 and 1994 (Gottschalk 1997). At the same time, real wages rose for workers in the upper tails of the wage distribution; thus, earnings inequality increased during the period.

Since 1994, however, the real wages of low-skilled male and female workers increased as a result of the strong economy (Card and Blank 2000; and Mishel et al. 2001). For example, the real wage of the 10th-percentile worker rose about nine percent between 1995 and 1999.

Finally, some evidence exists of occupational shifts over time within the low-wage sector (Bernstein and Hartmann 2000). For example, low-wage workers became less likely to work in clerical occupations and more likely to work in low-wage sales occupations than higher-wage workers. Similarly, by industry, low-wage workers became less likely to work in manufacturing and more likely to work in low-wage services such as the retail trade.

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