Understanding the Employment Patterns of Workers in Low- and Moderate-Income Households

Understanding employment patterns of different segments of the population—and the extent to which they may be exposed to or impacted by evolving labor market conditions—contributes to a deeper understanding of the economy, in support of the Federal Reserve’s monetary policy goals. Multiple factors influence the landscape of employment opportunities and barriers that can affect an individual’s or community’s experience of and ability to participate in the labor market, from shifts in what kinds of jobs locate where in different regions (and who has access to them) to evolving technologies (such as generative artificial intelligence [AI]) that are changing the nature of work.1 Lower-income workers, in particular, often experience barriers to participating and advancing in the labor market and achieving financial stability.2 This brief is the first in a series aimed at exploring the employment patterns of workers in lower-income households, how they have changed (and are changing) over time, and how these shifts influence the ability of these workers to engage in the economy. The focus of this brief is to define and better understand the composition of workers in lower-income households. After summarizing the methods and data sources used, we identify the population of workers living in lower-income households, explore their demographic and employment characteristics and how they compare with the workforce as a whole, assess how these patterns vary across different parts of the country, and examine how they have changed over the past decade. We conclude with a discussion of potential directions for future research.