April 28, 2020
While most Americans continue to shelter in place, tens of millions of essential workers are leaving their homes and going to work every day to keep the country running — and many are doing it for less than a living wage. Overall, around 40% of American workers do not make a living wage, earning less than $15 per hour. Within essential industries, in which businesses are generally continuing operations during the crisis, that fraction remains about the same. Although precise data is hard to find, our analysis suggests that at least 13 million workers in essential industries — and potentially twice that number — continue to commute to work every day, while earning less than $15/hr. Such high rates of underpaid essential workers are consistent across several definitions of essential workers, developed by federal, state, and local governments.
|All workers, pre-crisis||Fraction earning under $15/hr, pre-crisis||Workers earning under $15/hr, pre-crisis||Estimated workers still commuting to work for less than $15/hr|
|Industries whose businesses are permitted to remain open per State of Delaware||94M||36%||34M||26M|
|Industries considered frontline industries by NYC Comptroller Office (based on CEPR analysis)||41M||42%||17M||13M|
|Industries considered essential for infrastructure by DHS/CISA (based on Brookings analysis)||52M||36%||19M||14M|
Women and people of color are consistently overrepresented among the population of essential workers earning under $15/hour. Despite representing only 26% of the overall labor force, people of color represent 31-33% of essential workers being paid less than a living wage. And despite representing only 48% of the labor force, women represent 48-55% of these underpaid essential workers. Both populations are even more over-represented in the more limited definitions of essential industries (NYC and DHS), whose workers are especially liable to be at risk.
|Percent of...||...that are people of color.||...that are women.|
|...essential workers earning under $15/hr, per Delaware definition...||31%||48%|
|...frontline workers earning under $15/hr, per NYC definition...||32%||55%|
|...essential workers earning under $15/hr, per DHS definition...||33%||54%|
As with so much else, the crisis simply reveals the grave injustices already present in our society: The workers risking their lives daily to keep the country running are the same marginalized people whose needs are consistently neglected. This population contains elevated rates of people living with disabilities (7%, vs 5.5% among workers in general), people living without health insurance (16-20%, vs 10% among workers in general), and people who speak English not very well or not at all (7-9%, vs 4% among workers in general). They need salary increases, and much more. Especially during this crisis, these workers need protective equipment, sick pay, rights at work, and benefits for their families if they contract the virus. Long term, this moment is a wake-up call for our society to take the essential services these workers provide seriously, and treat this population with the dignity they, and the work they do, deserve.
For now, as our whole country is depending on them, the very least we can do is offer them a living wage.
Methodology and data sources
This section describes the general outlines of New America’s analysis. For more details, see technical appendix.
In recent weeks, various definitions of essential workers have circulated.
- On March 28, the Department of Homeland Security issued guidance with sixteen categories of workers essential to the nation’s infrastructure. These include “staffing operations centers, maintaining and repairing critical infrastructure, operating call centers, working construction, and performing operational functions, among others” as well as “workers who support crucial supply chains and enable functions for critical infrastructure. The industries they support represent, but are not limited to, medical and healthcare, telecommunications, information technology systems, defense, food and agriculture, transportation and logistics, energy, water and wastewater, law enforcement, and public works.”
- The NYC Comptroller Office has also outlined a list of “frontline industries” in the crisis. In addition to many of the industries on DHS’s list, NYC’s list includes construction, portions of agriculture, and daycares.
- Some states have issued expansive lists of essential industries in association with their stay-at-home orders, which indicate to businesses whether they are allowed to maintain operations. Delaware’s list, accessible on the Division of Small Business webpage, is especially detailed, with a match to NAICS-coded industries, and is a superset of DHS’s list. While not all of these businesses are necessarily essential, state-level blessing provides cover to employers who wish to maintain operations, who may force their employees to continue reporting to work.
Analysts at Brookings and CEPR, respectively, have matched the DHS and NYC lists to codes of essential industries for analysis. Some workers in essential industries may not be essential workers, and some may have been laid off in the crisis. Still more may be teleworking, although this portion is likely to be very low among low-wage workers; low-wage workers in these industries are primarily cashiers, nursing assistants, drivers, personal care aides, and stockers, jobs that can hardly be moved to telework. Conservatively, we estimate 75% of low-wage workers in essential industries are still commuting to work. (It is also possible some of these low-wage workers have gotten temporary raises increasing their pay over the $15/hr threshold. We assume this is — unfortunately — a negligible population.)
Using 2018 American Community Survey data, we identified all workers in essential industries based on these three classifications. We then identified all workers earning an average wage of less than $15 per hour. (Details in appendix.) The analysis suggests that essential workers may contain a slightly lower portion of workers earning under $15/hr than the overall economy — but not by much. Across the three models, the portion of workers earning less than a living wage remains roughly constant, ranging from 36 to 42%.
The classifications represent significantly different portions of the overall economy. Even using the smallest set of classifications — surely a significant undercount of essential business and workers — 13 million Americans earning under $15/hr are continuing to report to work every day.