10 Jobs That Can Pay Less Than Minimum Wage
It can be tough to make a decent living on the lowest wages in the United States. Even before taxes, working full-time at the federally mandated minimum of $7.25 per hour only earns you $15,080, assuming you work 40 hours each week without any vacation. In some cases you can net $20,000, but that annual income is hardly enough to live on.
Though many states and cities are taking the minimum wage into their own hands, raising the bar to $12 or even $15 per hour, it won’t solve the entire issue of low-earning wage workers. Many people will see a boost in their incomes if and when their local minimum wage rises. However, there are millions more American workers who earn less than the minimum wage, and might not see any sort of a boost in the near future.
Minimum wage exemptions
In some cases, those minimum wage exemptions apply to groups of people. Youth workers under age 20 can earn less than the minimum wage for the first 90 days of their employment, likely to prove they can handle the job before graduating to minimum wage after proving their work ethic. In addition, some workers with disabilities can earn less than the minimum wage, as can full-time students employed in certain jobs.
However, by law some jobs can also come with a paycheck that’s less than $7.25 per hour. These positions are officially exempted from the Fair Labor Standards Act, the law that dictates overtime and minimum wage pay. In fact, more employees earn less than the minimum wage than the number of people who earn the minimum wage, according to the Bureau of Labor Statistics. Roughly 870,000 workers earned exactly the minimum wage in 2015, and about 1.7 million Americans earned less than the minimum wage because of certain exemptions. The bureau reports that these workers make up about 3.3% of all hourly workers in the United States.
According to the Department of Labor, these types of jobs have a greater likelihood at offering sub-minimum wages than other career offerings.
1. Farm employees
Agricultural labor can be backbreaking, intensive work, but that doesn’t mean the wages are always good. Helping during the harvest or tending livestock on small farms can be exempt from minimum wage laws, meaning the starting payments can be less than $7.25 per hour. You can also be exempt from minimum wage laws if you are related to the owner of the farm, presumably to allow families to work the land together without requiring payments to children or other relatives.
Though all of these exemptions exist to make it easier to find workers and support the businesses, many workers will be offered at least the minimum wage so they’re convinced to apply for the job. According to data from the BLS, the median pay for agricultural workers is $20,090 per year, or roughly $9.66 per hour.
2. Seasonal and recreation workers
If a job is only open seasonally for a few months out of the year, the employer might not be required to offer minimum wage to its entire staff. This can affect ski lodge employees, amusement park operators, and additional recreational workers who are only needed on a temporary basis. Not only will you have your job for a few short months, but you might not make much doing so, either.
According to a BLS report, the annual median salary for amusement and recreation attendants is $9.27, meaning that some minimum wage positions are available.
3. Independent contractors
Independent contractors are defined by the IRS as anyone in a profession “if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.” This can include electricians who work on behalf of other businesses, to name one, or it can include doctors, dentists, lawyers, and other professionals.
Independent contractors are by nature self-employed, and do not fall into the minimum wage requirements. These contractors are counted differently by various governmental agencies, but anywhere from 7.9% to a full third of American employees can be considered contingent employees, the umbrella group under which independent contractors fall.
Obviously, doctors and lawyers are often charging far, far more than the minimum wage in exchange for their services. However, people working in specific trades might need to work harder to demand higher pay.
If you are a full-time child care worker, you fall under the minimum wage rules. However, people who babysit on a casual basis do not have the right to demand minimum wage payment. Technically, babysitters in this capacity would fall under the independent contractors, as would professional au pairs.
Even the most casual of babysitters will typically make more than the minimum wage, however. A Care.com survey in 2014 found that the average babysitting rate was $13.50 per hour, with sitters in cities like New York commanding a hefty paycheck of more than $15 per hour. Of course, that rate could include watching multiple children and conducting household tasks as well, but it’s a much higher margin than some of the other jobs on this list.
5. Tipped employees
If part of an employee’s compensation comes from tips, the base wage plummets from the minimum rate to a starting paycheck of $2.13 per hour. The theory is that most servers will end up earning more than the minimum wage when tips are taken into account. According to Pew, they do often exceed the minimum wage threshold, but only by small margins. In fact, the largest group of people earning near-minimum wages is that of restaurant/food service industry workers. About 3.75 million Americans work in a food service industry making near-minimum wage.
If you’re a fantastic server at a reputable restaurant, your take-home pay can be far greater than minimum wage. However, so much of that depends on the individual circumstances. Overall, the BLS reports that food and beverage servers, along with related personnel, earn a median salary of $19,040 per year.
Other minimum wage exemptions
In addition to the previous jobs, the Department of Labor lists a few other exemptions to the minimum wage laws. Some are typical jobs, but others suggest the specifications were needed to close odd employment loopholes (“homeworkers making wreaths” is one example). Among the list are the following five professions:
- Federal criminal investigators
- Switchboard operators
- Seamen on foreign vessels
- Employees in the fishing industry
- Newspaper delivery persons