Most low-wage workers in prime working years

Low-wage workers in Minnesota are predominantly a middle-aged group, many of them working more than 30 hours a week, caring for families and struggling to get by.

According to a new analysis from the Minnesota Department of Employment and Economic Development, 60 percent of the state's workers earning less than $20,000 per year are between 25 and 64 years old.

"Although some people work for low wages as a trade-off for more time or to supplement other sources of family income, the majority of low-wage workers rely on every penny," Amanda Rohrer, an analyst for the state, wrote in the report.

Amid the debate over the merits of a higher minimum wage, one criticism of an increase has been that it will mostly help teenagers working part-time jobs. Legislators earlier this year voted to raise the minimum in a series of steps through 2016.

While people 24 and younger are the state's largest group of workers right at the minimum wage, at least 27,000 Minnesotans between the ages of 25 and 54 will have seen a 31 percent pay increase by the time the minimum wage rises to $9.50 per hour in 2016, according to the Department of Labor and Industry.

And that doesn't count all the workers over 25 who earn somewhere just above the old minimum of $7.25 per hour and will see an increase over the next two years.

One person who will benefit is Maricela Flores, 40, who works for a contract cleaning company and lives in Shakopee. She is the mother of five children, with four still at home. Her wage will rise from $8 per hour to $9.50 per hour by 2016, roughly an extra $60 per week.

Those 15 to 24 are the largest group of minimum wage workers in Minnesota, according to the Department of Labor and Industry's 2013 report on the minimum wage. Of 83,000 people earning the minimum, about 50,000 are 15 to 24 years old.

But the number of people between 25 and 54 earning minimum wage in the state is still roughly twice what is was in 2009. And the new analysis released Thursday by the state's economic development agency shows that three-fifths of Minnesota's low-wage workforce — those earning less than $20,000 per year — are between 25 and 64.

Most work more than 30 hours per week — but not 40 hours, the report showed. They are dramatically less likely to have employer health insurance and they struggle to pay rent. Already, nearly half of Minnesota households spend more than 30 percent of their income on rent.

Legislators passed a law this spring increasing the minimum wage for most workers — those employed at companies with more than $500,000 in annual revenue — from $7.25 per hour to $8 per hour in August. The wage steps up $1 per hour next year and another 50 cents in August 2016 to $9.50 per hour.

"It would make a huge difference," said Flores, who cleans Target stores and is an active member of CTUL, the workers' association. "At the same time, you have to recognize that even at $9.50 it's not enough."

"We're most concerned about the inflator, and we think that's worth taking a look at," said Bruce Nustad, president of the Minnesota Retailers Association.

Nustad said retailers are looking to August of next year to gauge the effect on business. Firms farther from the Twin Cities will feel it more, because wages in rural areas and small towns run well below wages in the Twin Cities.

"That's where you really feel the crunch," Nustad said. "It's one Minnesota, it's one great state, but it's made up of different pockets with different dynamics."

Ben Gerber, a policy analyst at the Minnesota Chamber of Commerce, said the $500,000 revenue threshold is "effectively meaningless." Even very small businesses often hit $500,000 in revenue if they have a handful of employees.

Small businesses, Gerber said, will be affected the most, since they sell fewer products. One example of that was the Oasis Cafe in Stillwater, which instituted a 35-cent per ticket minimum wage fee in August and brought on a firestorm of social media criticism.

For Flores, who has not seen a wage increase in two years and cleans stores for one of the biggest companies in Minnesota, the wage increase is only a start.

"I think it's a good thing that the minimum wage will be going up, but overall we need to think about the workers who are producing things for these companies," she said. "We deserve to get a decent wage."

Flores has become involved in organizing janitors in the Twin Cities, going to regular worker meetings to strategize. She's also participated in three strikes.

"We're in this because we don't just want to survive," she said. "We want to live."