MIT study finds low-income wages in US show significant improvement
Date
8/11/2024 5:56:34 AM
(MENAFN) A recent study by MIT has revealed that average wages for low-income earners in the United States have seen considerable improvement over the past decade. this study focused on entry-level wages at McDonald's, a prominent fast-food chain, to provide insight into the earnings of young workers across the country. In 2023, entry-level workers at McDonald's earned an average of over USD13 per hour, a notable increase from the approximately USD7.50 per hour minimum wage at the start of the twenty-first century.
Despite this wage still being lower compared to many private sector roles, it represents a significant improvement and is considered relatively favorable in certain U.S. states. A newspaper highlights that McDonald's, while an example of low wages, is also an "important example" of wage trends. The hourly wage at McDonald's saw a modest annual increase of about 1 percent during the first decade of the 2000s but surged by 14 percent during the pandemic years of 2020 and 2021. This rise underscores the broader trend of wage growth for low-income workers amid various economic challenges.
The MIT study utilized an index called "Mac Wages," which adjusts for regional differences in wages and the cost of living, including meal prices at McDonald's. This index provides a clearer picture of the purchasing power of these wages across different states. For instance, McDonald's employees in Washington may experience relatively higher wages compared to their counterparts in Mississippi. This nuanced analysis reveals that while wages for low-income earners are improving, disparities remain based on geographic location.
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