New Report Finds 40% of Restaurant Workers Live in Near Poverty

Group of cooks working in a industrial kitchen
Take the heat, get out of the kitchen, whatever — these folks need better pay. Photo: Buzz Productions/Getty Images

Ongoing minimum-wage-related protests and various issues faced by fast-food workers made it into the president's State of the Union address this year, but an eye-opening new report just published by the Economy Policy Institute now indicates that low-level employees making 1,200 times less than the CEOs at the top aren't the only ones getting shafted. Industry workers make almost half as much as their non-restaurant peers and receive comparatively fewer benefits, and the sector keeps growing. Here are some standout findings from the nonprofit and nonpartisan group's report.

• With tips included, the average hourly wage is $10, while people outside the industry typically pull in $18 an hour, a rate restaurant employees with postgraduate degrees can't even break — they max out at $17.13 an hour.

• Accounting for inflation, that $10 hourly rate hasn't budged since 2000.

• One in six workers lives below the poverty line (the poverty rate outside the industry is 6.3 percent), and most shocking, 40 percent fall below twice the poverty-line threshold, generally considered the income level that makes ends meet.

• Cashiers and counter attendants make the least ($8.23 an hour), followed by dishwashers ($8.62 an hour).

• Even managers only average $15.42 per hour, lower than the median wage outside the industry.

• It's not a bunch of kids, either. More than half of workers are 25 to 54 years old. About three quarters have at least a high school diploma.

• Restaurants employ nearly a tenth of the private-sector workforce. And the percentage is growing — since 1990, it's crept up by more than a quarter.

• Finally, only 14.4 percent of workers receive insurance from their employer, versus nearly half of workers elsewhere. Although among what few unionized workers there are — 1.8 percent, all told — the number with health benefits jumps appreciably to 41.9 percent.

Low Wages and Few Benefits Mean Many Restaurant Workers Can't Make Ends Meet [EPI]
40 Percent of Restaurant Workers Live in Near-Poverty [Mother Jones]