APRIL 2015 LOW-WAGE CALIFORNIA: 2014 CHARTBOOKlaborcenter.berkeley.edu/pdf/2014/chartbook.pdf ·...

Future Job TrendsThe Industries

The JobsTheir FamiliesThe Workers

LOW-WAGE CALIFORNIA: 2014 CHARTBOOK

APRIL 2015

The Context: Growing Inequality and Stagnant Wages in California

Growing Inequality

Higher Productivity, Stagnant Wages

SECTION 1

Section 1 • The Context: Growing Inequality and Stagnant Wages in California page 2

Change in Real Wages in California, 1979–2014

GrowingInequality

Like the rest of the country, California has seen a steep growth in inequality since the late 1970s. Workers in the bottom and the middle of the wage distribution saw their earnings decline in real terms, after adjusting for inflation, while high-wage workers saw their earnings rise. Real wages for the median worker (in the 50th percentile) declined by 5 percent.

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Outgoing Rotation Groups, 1979–2014. Wages do not include tips, overtime pay, or commission.

-6%

-12%

-10%

-5%

-5%

-1%

6%

10th 20th 30th 40th 50th 60th 70th 80th 90th 95th

Wage Percentiles

35%

47%

17%

Section 1 • The Context: Growing Inequality and Stagnant Wages in California page 3

Growth of Real Median Compensation and Productivity in California, 1979–2013

Higher Productivity,Stagnant Wages

California workers have become more productive, but their wages and benefits have stagnated. Between 1979 and 2013, productivity increased by 89 percent, but median hourly compensation (wages plus benefits) for nonsupervisory/production workers increased by only 3 percent, adjusting for inflation.

Source: Economic Policy Institute analysis of unpublished total economy data from Bureau of Labor Statistics, Labor Productivity and Costs program; employment data from Bureau of Labor Statistics, Local Area Unemployment Statistics; wage data from the Current Population Survey; and compensation data from the Bureau of Economic Analysis, State/National Income and Product Accounts public data series, 1979–2013.

Productivity

89%

Median Hourly Compensation

3%

1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

Cum

ulat

ive

Perc

enta

ge C

hang

e Si

nce

1979

California’s Low-Wage Jobs Problem

HowDoWeDefine“LowWage”?

Number and Percent of Low-Wage Workers in California, 2014

SECTION 2

Section 2 • California’s Low-Wage Jobs Problem page 5

How Do We Define “Low Wage”?

Low-wage worker = earned less than $13.63 per hour in 2014

This report defines a low-wage worker as someone who earned less than two-thirds of the median hourly wage for full-time workers, which is a widely used metric.1 California’s median hourly wage for full-time workers was $20.44 in 2014, and two-thirds of that wage is $13.63. Therefore, this report considers any individual who earned less than $13.63 per hour in 2014 to be a low-wage worker.

California workers, ages 18–64, who were not self-employed

See Data and Methods for moredetails

Definition

The Sample

For MoreDocumentation

1 Boushey H., Fremstad S., Gragg R., and Waller M. (2007) “Understanding Low-Wage Work in the United States.” The Mobility Agenda and Center for Economic and Policy Research.

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Outgoing Rotation Groups, 2014.

http://laborcenter.berkeley.edu/pdf/2014/chartbook-data-and-methods.pdf

Section 2 • California’s Low-Wage Jobs Problem page 6

Number and Percent of Low-Wage Workers in California, 2014

One of every three California workers earns low wages

That translates into 4,771,000 low-wage workers

33 percent of California workers earned less than $13.63 in 2014

This percentage is up from 30 percent in 2000

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Outgoing Rotation Groups, 2000 and 2014.

ProfileofLow-WageWorkers

Age

Education

Changes in Age and Education Over Time

Race, Ethnicity and Nativity

Gender

Rates of Low-Wage Work

SECTION 3

Section 3 • Profile of Low-Wage Workers page 8

Age Distribution of California Workers, 2014

Age The large majority (95 percent) of California’s low-wage workers are adults, not teens. The average age for low-wage workers is 35, compared to 40 for all workers.

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Outgoing Rotation Groups, 2014. Teens aged 16–17 make up 0.6 percent of the overall workforce under age 65, and 1.5 percent of the low-wage workforce under age 65.

5% 2%

25%

19%

24%

24%

34%

11% 15%

Low-Wage Workers All Workers

55–64

40–54

30–39

20–29

18–1940%


12%

22%

21%

7%

9%

23%

24% 30% 27%

10% 3%

12%

Low-WageWorkers

AllWorkers

Less than High School

High School

Some College

Associate's Degree

Bachelor's Degree

Advanced Degree

Educational Distribution of California Workers, 2014

EducationCalifornia’s low-wage workers are less educated than the overall workforce, but morethan 45 percent have some college experience or higher, and about one in ten has a bachelor’s or advanced degree.



Age and Education Distribution of Low-Wage California Workers, 1979–2014

Changes in Age and Education Over Time

California’s low-wage workers are older and more educated than ever. Between 1979 and 2014, the share of teenagers declined by more than half, while the age group with the biggest growth was 35–64 year olds. Over the same time period, the percentage with less than a high school degree declined, while the percentage with some college experience or a college degree increased.

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Outgoing Rotation Groups, 1979–2014. Estimates in this chart do not perfectly match estimates in previous slides due to the use of a different wage variable to allow for comparability over time (wages for this chart exclude tips, commissions, and overtime).

16% 5%

28%

25%

24%

26%

32%

44%

1979 2014

29% 20%

32%

33%

31%

35%

8%

13%

1979 2014

35–64

25–34

20–24

18–19

College and Advanced Degrees

Some College

High School


Age Education


Latino/a Black Asian White Other

Race and Ethnicity of California Workers, 2014

Race, Ethnicity, and Nativity

Workers of color constitute the majority of California’s workforce. This is especially true for the state’s low-wage workers: for example, 56 percent are Latino/a, compared to 39 percent for all workers. A higher proportion of California’s low-wage workforce is foreign born (40 percent) as compared to the proportion of all workers (33 percent).


56%

39%

6%

5%

11%

16%

26%

39%

Low-WageWorkers

AllWorkers

Percent of California Workers Who are Foreign Born, 2014

40%

33%

Low-WageWorkers

AllWorkers


Percent Women, by Race/Ethnicity, Among California’s Low-Wage Workers, 2014

GenderOverall, half of California’s low-wage workers are women, but there is significant variation across demographic groups. For all groups except Latinos, women make up a disproportionate share of low-wage workers.


White

Black

Latina

Asian

All Low-WageWorkers

55%

51%

48%

57%

51%


Rates of Low-Wage Work


Race/Ethnicity

Age

Countryof Birth

Education

Gender

It is also useful to examine the proportion of low-wage workers within major demographic groups (i.e., the of low-wage work). Rates of low-wage work are above average among young workers, women, Latino, black, and foreign-born workers. Workers without a college degree also have higher rates of low-wage work.

Share of Low-Wage Workers within Major Demographic Groups in California, 2014

Average: 33%

18–19

20–29

30–39

40–54

55–64

Male

Female

White

Black

Latino/a

Asian

Other

U.S. Born

Foreign Born


High School

Some College

Associate's Degree

Bachelor's Degree

Advanced Degree

87%

54%

26%

24%

23%

30%

36%

22%

38%

48%

23%

36%

30%

40%

65%

45%

42%

28%

14%

7%

The Families of Low-Wage Workers

Family Income

Workers’ Share of Family Income

Family Poverty Level

Family Structure

SECTION 4

Section 4 • The Families of Low-Wage Workers page 15

Family Income of California Workers, 2000–2013

FamilyIncome

Even when combining the wages of all workers in the family, the median family income of California’s low-wage workers was about $29,000 in 2013, half of the state’s overall median. Adjusted for inflation, low-wage workers’ families have seen their incomes decline by 12 percent since 2000 (compared to a 3 percent decline for all families).

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Annual Social and Economic Supplement, 2000–2013. Wages are in constant 2014 dollars.

$33,100 $29,100

$64,800 $63,000

2000 2013 2000 2013

Low-Wage Workers’ Families All Workers’ Families


Average Share of Family Income Earned by California Workers, 2013

Workers’ Shareof Family Income

Low-wage workers’ earnings make up a majority (61 percent) of their family’s income. Moreover, 42 percent of low-wage workers are the sole earner in their family (similar to the workforce as a whole).

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Annual Social and Economic Supplement, 2013.

61% 70%

Low-WageWorkers

All Workers


Family Poverty Level of California Workers, 2013

Family PovertyLevel

Low-wage workers are much more likely to live in families with incomes below the Federal Poverty Level (FPL) as compared to the overall California workforce. Almost 60 percent of low-wage workers live in families under 200 percent of the FPL.



400% +

200–400%

150–200%

100–150%

<100%

26%

19%

14%

28%

13%

10%

9%

9%

31%

42%


Low-WageWorkers

AllWorkers

Married without Children

Married withChildren

Single withoutChildren

Single withChildren

Family Structure of California Workers, 2013

Family Structure Close to half (40 percent) of low-wage workers are married and 43 percent have children.


23%

17%

30%

23%

35%

40%

12%

20%

ProfileofLow-WageJobs

Wages and Earnings

Full-Time/Part-Time Status

Full-Year/Part-Year Status

Union Membership

EmployeeBenefits

Other Dimensions of Job Quality

SECTION 5

Section 5 • Profile of Low-Wage Jobs page 20

Median Annual Earnings in California, 2013

Wages andEarnings

The median wage for low-wage workers was $9.97 an hour in 2014, almost half the median for all California workers. Median annual earnings for low-wage workers were $15,300 in 2014, and only $9,200 for part-time workers. But even when working full time, median earnings for low-wage workers only reached $20,400.

Source: Authors’ analysis of Center for Economic and Policy Research’s data extract of the Current Population Survey, Annual Social and Economic Supplement 2013 and Outgoing Rotation Groups, 2014. Wages are in constant 2014 dollars.

Median Hourly Wages in California, 2014

Overall

PartTime

Full Time

$15,300

$35,600

$9,200

$12,200

$20,400

$43,800

Low-Wage Workers

All Workers

Low-Wage Workers

All Workers

Low-Wage Workers

All Workers

$9.97

$18.36

Low-WageWorkers

AllWorkers


Full-Time/Part-Time Status for California Workers, 2014

Full-Time/Part-Time StatusLow-wage workers are almost twice as likely to work part time (defined as less than 35 hours per week) compared to the overall California workforce. Low-wage workers also have double the rate of involuntary part-time work compared to the overall workforce (14 percent compared to 7 percent).


Full-Time

76%Part-Time

24%

Voluntary17%

Involuntary7%

Full-Time

60%Part-Time

40%

Voluntary26%

Involuntary14%


Full-Year/Part-Year Work for California Workers, 2013

Full-Year/Part-Year StatusNot only are low-wage workers more likely to work part time, they’re also more likely to work part year (less than 50 weeks) compared to the overall workforce. The result is that only 54 percent of low-wage workers have full-time, full-year jobs.



Full-Time, Full-Year

Full-Time, Part-Year

Part-Time, Full-Year

Part-Time, Part-Year

54%71%

7%12%

22%

12%

12%

10%


Percent of California Workers Who are Union Members, 2014

Union Membership Low-wage workers are less likely to be members of a union compared to the overall California workforce.


8% 16%Low-WageWorkers

All Workers


EmployeeBenefits

Low-wage workers are half as likely as the overall California workforce to receive health insurance or pension benefits from their employer. Since 1980, the share of low-wage workers with health insurance benefits has fallen by half, and the share with pension benefits has fallen by almost one-fourth.


51%

25%

54%

23%

All Workers

Low-Wage Workers

All Workers

Low-Wage WorkersEmployer-Sponsored

Health Insurance

Employer-Sponsored Pension

Percent of California Workers with Employer-Sponsored Health or Pension Benefits, 2013


Other Dimensions of Job Quality

Only 29 percent of California’s low-wage workers had access to paid sick days in 2012 (prior to passage of California’s paid sick leave legislation), compared to 67 percent of the overall working population (statistics are for full-time workers only).1

Lack of Paid Sick Days

Unpredictable and “On Call” Schedules

Wage Theft

In a national sample of early career workers in 2011, the large majority of low-wage workers had fluctuations in their work hours (70 percent for full-time workers and 85 percent of part-time workers), and close to half received one week or less advanced notice of scheduling changes.2

In a 2013 survey of California grocery store workers, 47 percent reported that their schedule varied from week to week at least some of the time, and 25 percent reported that they had to be available for “on call” shifts at least some of the time.3

A 2008 survey of very low-wage workers in Los Angeles (median wage of $8.06 in 2008 dollars) found rampant wage theft: 30 percent were paid less than the minimum wage in the previous work week; 79 percent of those who worked overtime were not paid the legally required overtime rate; and 71 percent did not receive any pay when they worked before or after their regular shift. Workers with violations lost an average of $2,070 to wage theft, out of total annual earnings of $16,536.4

1 Milli J. (2014) “Access to Paid Sick Days in California.” Institute for Women’s Policy Research.2 Lambert S., Fugiel P., and Henly J. (2014) “Precarious Work Schedules among Early-Career Employees in the US: A National Snapshot.” EINet.3 Jayaraman S. (2014) “Shelved: How Wages and Working Conditions for California’s Food Retail Workers Have Declined as the Industry Has Thrived.”Food Labor Research Center, University of California, Berkeley. 4 Milkman R., Gonzalez A., and Narro V. (2010) “Wage Theft and Workplace Violations in Los Angeles” Institute for Research on Labor and Employment, University of California, Los Angeles.

A Closer Look at Low-Wage Industries and Occupations

Industries

Rates of Low-Wage Work, by Industry

Major Occupations

Rates of Low-Wage Work, by Major Occupations

Top Ten Detailed Low-Wage Occupations

Self-Employed Workers

SECTION 6

Section 6 • Closer Look at Low-Wage Industries and Occupations page 26

IndustriesLow-wage workers are employed throughout California’s economy, but retailers and restaurants alone account for 28 percent of the state’s low-wage workers. (Industry is a category that describes businesses.)

Source: Authors’ analysis of American Community Survey IPUMS, 2012 and 2013, 1-year samples.

Distribution of California’s Low-Wage Workers Across Industries, 2012–2013

14%

14%

6%

6%

6%

5%

5%

5%

4%

4%

4%

4%

4%

3%

3%

3%

3%

2%

2%

2%

2%

1%

0%

Retail Trade

Restaurants and Other Food Services

Educational Services

Administrative and Business Services

Personal Services and Non-Profits

Agriculture, Forestry, and Fishing

Durable Manufacturing

Non-Durable Manufacturing

Construction

Outpatient Health Care Services

Community, Family, and Child Care Services

Finance, Insurance, and Real Estate

Grocery Stores

Transportation, Warehousing, and Utilities

Wholesale Trade

Arts, Entertainment, and Recreation

Professional, Scientific, and Management Services

Hospitals

Public Administration

Nursing and Residential Care Facilities

Accommodation

Information and Communication

Mining


Rates ofLow-Wage Work, by Industry

California industries that have high rates of low-wage work include key parts of the service sector (such as restaurants, retail, hotels, and home care and child care services), as well as key parts of the goods-producing sector (such as agriculture and non-durable manufacturing).


Share of California Workers That Earn Low Wages Within Industries, 2012–2013

71%

68%

52%

51%

51%

50%

50%

50%

49%

43%

41%

32%

31%

29%

25%

24%

22%

20%

17%

15%

14%

13%

12%

Agriculture, Forestry, and Fishing

Restaurants and Other Food Services

Grocery Stores

Community, Family, and Child Care Services

Nursing and Residential Care Facilities

Retail Trade

Accommodation

Administrative and Business Services

Personal Services and Non-Profits

Arts, Entertainment, and Recreation

Non-Durable Manufacturing

Wholesale Trade

Outpatient Health Care Services

Construction

Transportation, Warehousing, and Utilities

Educational Services

Durable Manufacturing

Finance, Insurance, and Real Estate

Information and Communication

Hospitals

Mining

Public Administration

Professional, Scientific and Management Services

Average: 33%


MajorOccupations

Low-wage workers are employed in all major occupations, but three groups—office and administrative support, sales, and food preparation and serving occupations—account for 41 percent of California’s low-wage workers. (Occupation is a category that describes jobs.)


Distribution of California’s Low-Wage Workers Across Occupations, 2012–2013

4%

0%

14%

14%

13%

9%

8%

7%

7%

4%

4%

3%

3%

2%

2%

2%

1%

1%

1%

1%

1%

0%

0%

Office and Administrative Support

Sales and Related Occupations

Food Preparation and Serving Occupations

Transportation and Material Movement

Production Occupations

Personal Care and Service Occupations

Building and Grounds Cleaning

Farming, Fishing, and Forestry

Education, Training, and Library Occupations

Construction and Extraction

Healthcare Support Occupations

Management, Business, and Science Occupations

Installation, Maintenence, and Repair

Protective Service

Healthcare Practitioner and Technical Occupations

Arts, Entertainment, Sports, and Media

Commmunity and Social Services

Business Operations Specialists

Financial Specialists

Computer and Mathematical Operations

Life, Physical, and Social Science Occupations

Architecture and Engineering Occupations

Legal Occupations


Rates of Low-WageWork, by Major Occupations

California occupations that have high rates of low-wage work include service jobs (such as food preparation workers, home care workers, and janitors), as well as jobs in the goods-producing sector(such as farm workers and warehouse workers).


Average: 33%

Share of California Workers That Earn Low Wages Within Occupations, 2012–2013

Farming, Fishing and Forestry

Food Preparation and Serving Occupations

Personal Care and Service Occupations

Building and Grounds Cleaning

Transportation and Material Movement

Healthcare Support Occupations

Production Occupations

Sales and Related Occupations

Office and Administrative Support

Construction and Extraction

Installation, Maintenence, and Repair

Protective Service

Education, Training and Library Occupations

Arts, Entertainment, Sports, and Media

Commmunity and Social Services

Life, Physical, and Social Science Occupations

Business Operations Specialists

Healthcare Practitioner and Technical Occupations

Management, Business, and Science Occupations

Financial Specialists

Legal Occupations

Computer and Mathematical Operations

Architecture and Engineering Occupations

79%

68%

67%

63%

49%

48%

47%

45%

35%

31%

28%

26%

24%

21%

20%

13%

12%

11%

10%

8%

7%

6%

4%


Top Ten Detailed Low-Wage Occupations

Top Ten Low-Wage Occupations in California, 2012–2013

504,600

Cooks and Food Preparation Workers 267,800

Material Moving Workers 253,100

Personal Care Aides, Childcare Workers, and Other Personal Care and Service Workers 252,700

Customer Service Representatives and Other Information and Record Clerks 234,000

Janitors, Maids, and Pest Control Workers 225,800

Waiters, Waitresses, Bartenders, and Other Food and Beverage Serving Workers 197,300

Agricultural Workers 191,200

Construction Trades Workers 169,800

Material Recording, Scheduling, Dispatching and Distributing Workers 160,900

Retail Sales Workers

Ranked by Number of Low-Wage Workers

82

Textile, Apparel, and Furnishings Workers 79

Cooks and Food Preparation Workers 76

Cafeteria Attendants, Dishwashers, and Hosts and Hostesses 75

Personal Care Aides, Childcare Workers, and Other Personal Care and Service Workers 71

Grounds Maintenance Workers 68

Retail Sales Workers 66

Animal Care and Service Workers 65

Personal Appearance Workers 63

Janitors, Maids, and Pest Control Workers 63

Agricultural Workers

Ranked by Percent of the Occupation that is Low Wage

Source: Authors’ analysis of American Community Survey IPUMS, 2012 and 2013, 1-year samples. Data in the first table are rounded to the nearest 100.


Percent of Self-Employed Workers in California Who Earn Low Wages, 2013

Self-EmployedWorkers

A separate analysis of self-employed workers in California shows that 43 percent earn low wages. The top five industries for low-wage self-employed workers are construction, landscaping services, beauty salons, building services, and child day care services.


Part Time

40%

Top Five IndustriesConstructionLandscaping ServicesBeauty SalonsBuilding ServicesChild Day Care Services

43%

Future Employment Trends

Employment Projections: Industries

Employment Projections: Occupations

Employment Projections: Educational Requirements

SECTION 7

Section 7 • Future Employment Trends page 33

Employment Projections: Industries

Official employment projections to 2022 do not show a significant change in California’s industry mix, meaning that our state’s low-wage jobs problem will continue into the foreseeable future.

Industry Distribution of California Employment, 2012–2022

Source: California Industry Employment Projections, Employment Development Department, Labor Market Information Division, 2012–2022.

IndustryEmployment Share (%)

2012 2022 projected 2012–2022

Percentage Point Change

Farm Workers, Logging, and MiningConstructionDurable Goods ManufacturingNondurable Goods ManufacturingWholesale TradeRetail TradeTransportation and Warehousing and UtilitiesInformationProfessional and Business ServicesEducational Services (Private)Health Care and Social AssistanceArts, Entertainment, and RecreationAccommodation and Food ServicesOther ServicesSelf-EmployedGovernment (Federal, State, and Local)

2.63.64.82.94.29.73.02.7

18.52.1

11.31.68.33.56.7

14.6

2.64.24.02.44.29.63.02.7

19.52.2

12.51.68.63.36.3

13.2

-0.10.6

-0.8-0.50.0

-0.10.00.01.00.21.20.00.4

-0.2-0.4-1.4


Employment Projections: Occupations

Low-wage occupations (shown in red) top the list of projected job growth in California between 2012 and 2022.

Top Ten California Occupations with Largest Projected Employment Growth, 2012–2022

Source: California Industry and Occupation Employment Projections, Employment Development Department, Labor Market Information Division, 2012–2022. Median wage from authors’ analysis of American Community Survey IPUMS, 2012 and 2013, 1-year samples. Wages are in constant 2014 dollars.

OccupationNet Employment Growth

2012–2022 Median Wage

2012–2013

Personal Care AidesFood Preparation and Serving WorkersRetail SalespersonsLaborers and Freight, Stock, and Material MoversWaiters and WaitressesRegistered NursesGeneral and Operations ManagersSecretaries and Administrative AssistantsCashiersRestaurant Cooks

200,30076,40059,70051,80044,20042,90041,90037,30034,80033,700

$9.40$9.33

$11.63$11.85$11.23$41.98$35.10$18.83$9.25$9.79

{{

Low-WageOccupations

Low-WageOccupations

{Not Low-WageOccupations


Percent of California Occupations by Entry-Level Educational Requirements, 2012–2022

Employment Projections:Educational Requirements

Official projections also show no significant change by 2022 in the distribution of employment by occupations’ required education for an entry-level job.

Source: California Occupation Employment Projections, Employment Development Department, Labor Market Information Division, 2012–2022.

30%

36%

6%

4%

20%

29%

37%

6%

4%

19%

4% 4%


High School Diploma or GED

Some College, No Degree

Associate's Degree

Bachelor's Degree

Master's Degree and Higher

2012

2022

The Impact of Low-Wage Jobs

Economic Insecurity for Families

Other Effects of Low Wages

The Public Cost of Low-Wage Work

SECTION 8

Section 8 • The Impact of Low-Wage Jobs page 37

Economic Insecurity Measures for California Families, 2012–2013

EconomicInsecurityfor Families

Low-wage workers’ families are more likely to have children receiving free or reduced-price school lunch, to have a higher than recommended rent burden, to have a family member enrolled in Medi-Cal, and to live below the Federal Poverty Line.

Source: Authors’ analysis of American Community Survey IPUMS, 2012 and 2013, 1-year samples, and Center for Economic and Policy Research’s data extract of the Current Population Survey, Annual Social and Economic Supplement, 2013.

Low-WageWorkers

All Workers37%

17%

10%

47%

Proportion of householdswith children that receive

free or reduced-price lunch

Proportion of householdsthat pay more than 30 percent

of their income in rent

Proportion of workerswith a family member

enrolled in Medi-Cal

Proportion of workerswith family income below

Federal Poverty Line

69%

54%

28%

26%


Low wages have been shown to negatively affect the health of workers.All else equal, low wages (and in turn poverty) result in increased rates of high blood pressure and high levels of stress, as well as shorter life expectancy.1

Parents’ earnings affect the future earnings and work hours of their children.All else equal, children from low-income families earn less and work fewer hours as adults. These effects are most pronounced when family income is low during the prenatal period and first five years of the child’s life.2

Parents’ earnings affect the academic outcomes of their children. Multiple randomized studies have shown that an increase in family income results in young children doing better in school and completing more years of school.3 The reverse is also true, suggesting there are negative effects on the educational attainment of children from low-income families.

1 Leigh J. and Du J. (2012) “Are low wages risk factors for hypertension?” European Journal of Public Health, Volume 22, Number 6, Pages 854-859. Also Waldron, H. (2007) “Trends in Mortality Differentials and Life Expectancy for Male Social Security-Covered Workers, by Average Relative Earnings.” U.S. Social Security Administration; Office of Policy. ORES Working Paper No.108.2 Duncan G., Ziol-Guest K. and Kalil A. (2010) “Early-Childhood Poverty and Adult Attainment, Behavior, and Health.” Child Development, January/February 2010, Volume 81, Number 1, Pages 306-325.3 Duncan G., Morris P. and Rodriguez C. (2011) “Does money really matter? Estimating impacts of family income on young children’s achievement with data from random-assignment experiments.” Developmental Psychology, Volume 47, Number 5, Pages 1263-1279. Also Clark-Kaufman E., Duncan G. and Morris P. (2003) “How welfare policies affect children and adolescent achievement.” American Economic Review, Volume 93, Number 2, Pages 299-303.

Other Effectsof Low Wages

Low-wage jobs have other negative effects on the lives of workers and their children, both in the near and long term.


Average Annual Expenditures by Public Assistance Programs for Low-Wage Workers’ Families in California (in Millions), 2007–2012

The Public Cost of Low-Wage WorkThe families of low-wage workers are more likely to have to rely on public assistance programs to make ends meet. From 2007–2012, the average annual expenditures of TANF, EITC, Medicaid, CHIP, and Food Stamp programs for low-wage workers’ families in California was $14.3 billion.

Source: Authors’ analysis of Current Population Survey, Annual Social and Economic Supplement, 2007-2012, and programadministrative data. Expenditures are in constant 2014 dollars.

$866

$4,025 $3,953 $3,719

$1,739

TANF EITC Medicaid–Adults

Medicaid–Children

Food Stamps

Where Low-Wage Workers Work

The Geography of Low-Wage Work

SECTION 9

Section 9 • Where Low-Wage Workers Work page 41

The Geography ofLow-Wage Work

California’s low-wage workers are concentrated in Southern California, with 51 percent working in that region. By contrast, the San Joaquin Valley region has the highest rate of low-wage work (44 percent of its workforce). For more geographic breakdowns, see the Interactive Maps.

Where California’s Low-Wage Workers Work, 2012–2013

Source: Authors’ analysis of American Community Survey IPUMS, 2012 and 2013, 1-year samples. Economic Region definitions are taken from the California Economic Strategy Panel, formerly a part of the California Employment Development Department. The analysis follows the EDD region definitions, with two exceptions due to data limitations. Trinity County is included in the Northern Sacramento Valley region, and San Benito County is a part of the Central Coast region.

Economic Regions

Percent of CA’sLow-Wage Workers

in the Region

Percent of CA’sEntire Workforce

in the Region

Percent of the Region’s Workers

that Earn Low Wages

Southern CaliforniaBay AreaSan Joaquin ValleySouthern BorderGreater SacramentoCentral CoastNorthern Sacramento ValleyNorthern CaliforniaCentral Sierra

511611954110

48239963110

372544333240414036

https://public.tableau.com/profile/uc.berkeley.labor.center#!/vizhome/Low-WageCalifornia2014ChartbookInteractiveMaps/Dashboard1

UC Berkeley Center for LaborResearch and EducationFounded in 1964, the Center for Labor Research and Education (Labor Center) at the University of California, Berkeley, works on the most pressing economic challenges affecting working families in California and communities across the country. The Labor Center provides timely, policy-relevant research on labor and employment issues for policy makers and stakeholders, and conducts trainings for a new, diverse generation of worker leaders.

Institute for Research on Labor and EmploymentUniversity of California, Berkeley

2521 Channing WayBerkeley, CA 94720-5555

(510) 642-0323laborcenter.berkeley.edu

“Low-Wage Work in California: 2014 Chartbook” is the first edition of an ongoing resource with a wide range of information about low-wage workers, their families, and their jobs. The chartbook will be updated annually as new U.S. Census Bureau data becomes available.

“Low-Wage Work in California: 2014 Chartbook” was researched and written by:

Annette Bernhardt, Senior Researcher at the UC Berkeley Center for Labor Research and Education, and Visiting Professor at the UC Berkeley Sociology Department

Ian Perry, Research and Data Analyst at the UC Berkeley Center for Labor Research and Education

Lindsay Cattell, Researcher at the UC Berkeley Goldman School of Public Policy

APRIL 2015 LOW-WAGE CALIFORNIA: 2014 CHARTBOOKlaborcenter.berkeley.edu/pdf/2014/chartbook.pdf ·...

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