Who gains the most from President Obama's overtime initiative? We break down the numbers.
Who stands to win under President Barack Obama's proposal to increase the availibility of overtime to American workers? We've crunched data to get a clue ahead of Obama's more detailed rollout of his initiative later this week. The answer is good news for some real estate managers, tax preparers and managers of places like Dunkin Donuts.
Under the plan, Obama would increase the threshold under which salaried workers receive overtime pay from $23,660 to $50,440. He claimed that the new rule, if implemented in 2016, would extend overtime payment to nearly 5 million workers.
The current threshold has been unchanged since it was raised to $23,660 in 1975 by the Ford administration. Back then it covered 62 percent of salaried workers, but in 2014 the number has declined to just 8 percent, according to an analysis published last Friday by the Economic Policy Institute, a think tank based in Washington DC. The analysis stated that if the threshold is raised to $52,000, equivalent to the 1975 level in 2014 dollars, it would cover 44 percent of the workforce.
Wondering which occupations are more likely to receive the highest overtime pay under the new rule, PRI did an analysis of the latest earnings and work hours data compiled by the Bureau of Labor Statistics.
It turned out that workers in the management, business and financial operations category who are currently earning below $50,440, or $970 but do not qualify for overtime pay would be the biggest winner as they have to endure longer work hours.
These occupations are financial specialists, logisticians, purchasing agents (except wholesale, retail and farm products), real estate managers, tax preparers, wholesale and retail buyers (except farm products), agricultural managers, food service managers, and human resources workers.
Earning an average weekly wage ranged between $704 to $962, they had the longest average working hours of 44.7 hours per week. The 4.7 hours of overtime would increase their weekly salary by almost 12 percent. For example, a human resource manager who earns $962 weekly, he or she would bring home an extra income of $5,878 a year.
For the lowest-paid occupations, mostly in the categories of service occupations, such as food attendants, dishwashers, maids and cooks, they would enjoy a smaller pay hike around three percent as their overtime is lower (1.3 hours). Still, they would earn an extra annual income of slightly over $600.
Use the table below to find out how the proposed rule would affect you or your friends and families. Click on the header to sort the table and filter the table by typing search terms in the top-right search box.