Top 10 States in the US With Highest Wage
Top 10 States in the US With Highest Wage
Summary

In recent years, more and more cities and counties have established their own minimum wage rates, which take precedence over both the Federal and state minimum wages.

In states where employers are subject to state and federal minimum wage laws, employees earn the higher of the two wages. For example, as of January 1, 2022, if you work a minimum wage job for an employer in Illinois, you’d earn $12 per hour instead of the federal minimum wage of $7.25.

Not every state has a minimum wage law. Alabama, Louisiana, Mississippi, South Carolina, and Tennessee don’t have state minimum wage laws. Instead, they’ve adopted the federal minimum wage of $7.25. In addition, in 2020, four of these states (Alabama, Louisiana, Mississippi, South Carolina, and Virginia) had the highest percentages of hourly paid workers earning at or below the minimum wage, according to the U.S. Bureau of Labor Statistics (a branch of the U.S. Department of Labor).

During the COVID-19 pandemic, employment fell, especially for low-wage workers. As a result, the number of workers earning the federal minimum wage or less declined in 2020.

In 2020, about 247,000 workers paid by the hour) earned the federal minimum wage of $7.25, while approximately 865,00 workers earned less than the federal minimum wage, according to the Bureau of Labor Statistics.

Average Income by State 2022/2023

In the United States, average personal income varies significantly. Many factors affect average personal income levels: the job market, the ratio of costs to profits, and the state of the economy. A state's educational attainment levels have a significant impact on average income. Higher educational attainment, such as getting a graduate or professional degree, leads to higher-paying jobs, increasing the average personal income. The states with the highest education attainment are D.C. and Massachusetts, which have the country's two highest average incomes at $88,702 and $81,123. The states with the highest educational attainment levels are Maryland, Connecticut, New Jersey, New Hampshire, and New York, which are also among the ten states with the highest average incomes.

The cost of living and the various industries that thrive in a state impact how much money employees are offered, too. States with a higher cost of living generally have higher salaries. The federal government does not determine minimum wage and salaried positions, so the local state governments have full control over these rates, among others.

States that pay less than the federal minimum wage

Georgia and Wyoming don’t have state-level minimum wages. Both states have a minimum wage of $5.15.

But how is it possible for someone to earn less than the national minimum wage?

Generally, wage workers in Wyoming and Georgia do earn the federal minimum wage of $7.25, but there are a few exceptions for employers who don't fall under the Fair Labor Standards Act (FLSA). However, most medium and large employers fall under the FLSA, so most workers in these two states earn at least $7.25 an hour.

The top five U.S. cities with the highest minimum wage according to Investopedia are:

  • Emeryville, California—$17.30
  • Seattle—$16.69
  • Sunnyvale, California—$16.30
  • Mountain View, California—$16.30
  • San Francisco—$16.07

Top 10 States in the US With the Highest Wage Today

1. Florida

Photo: canva
Photo: canva

As of Aug 7, 2022, the average annual pay for the Average jobs category in Florida is $53,905 a year. Just in case you need a simple salary calculator, that works out to be approximately $25.92 an hour. This is the equivalent of $1,036/week or $4,492/month.

The average pay range for an Average job varies greatly (as much as $21,163), which suggests there may be many opportunities for advancement and increased pay based on skill level, location and years of experience.

2. Texas

Texas' average annual wages were $57,382 as of the fourth quarter of 2018, slightly higher than the U.S. average of $56,945 and 12th among the states.

There was a broad range of wage levels within the state, however.

The Gulf Coast’s average annual wages of $66,086 led all Texas regions and would rank fifth nationally if it were a state. The Capital, Metroplex and West Texas regions also had average annual wages higher than the national level.

Other Texas regions’ annual wages were lower than the national average. South Texas ranked last, at $38,168.

3. Arizona

Arizona’s minimum wage had a slight bump from $12.15 to $12.80 per hour in January 2022. Workers exempt from receiving the $12.15 minimum wage in Arizona include those who are employed by a parent or a sibling, casual babysitters, people employed by the Arizona state or federal government and those employed by a small business with less than $500,000 in annual revenue.

4. North Carolina

Photo:  The News & Observer
Photo: The News & Observer

As of Aug 7, 2022, the average annual pay for the Average jobs category in North Carolina is $55,106 a year. Just in case you need a simple salary calculator, that works out to be approximately $26.49 an hour. This is the equivalent of $1,059/week or $4,592/month.

The average pay range for an Average job varies greatly (as much as $19,912), which suggests there may be many opportunities for advancement and increased pay based on skill level, location and years of experience.

5. South Carolina

In 2020, the median household income in South Carolina amounted to 60,097 U.S. dollars. This is a decrease from the previous year when the median household income in the state amounted to 62,028 U.S. dollars.

As of Aug 7, 2022, the average annual pay for the Average jobs category in South Carolina is $65,377 a year. Just in case you need a simple salary calculator, that works out to be approximately $31.43 an hour. This is the equivalent of $1,257/week or $5,448/month.

6. Washington

Washington has been a leading state when it comes to high minimum wages for quite some time. In 2014, Seattle passed legislation that would raise the minimum wage to $15 per hour by 2021. As of January 2022, the minimum wage has increased in the city even further to $17.27. However, it’s not the only city to see a minimum wage above $16 in Washington. SeaTac, home base to Seattle-Tacoma International Airport, currently has a minimum wage of $17.54 for employers in the hospitality and transportation industries.

7. New York

New York’s minimum wage fluctuates depending on where you work. In New York City, Westchester County, and Long Island, the minimum wage is $15. The rest of the state abides by a minimum wage of $13.20, though it is expected to increase yearly until it eventually reaches $15.

8. California

Photo: businessinsurance
Photo: businessinsurance

Workers in California at small businesses with 25 or fewer employees currently earn $14 per hour; for workers at businesses with 26 or more employees, the minimum wage is $15 per hour. All workers in California, regardless of the size of their employer, will earn $15 by 2023.

9. Illinois

A person working in Illinois typically earns around 111,000 USD per year. Salaries range from 28,000 USD (lowest average) to 494,000 USD (highest average, actual maximum salary is higher).

This is the average yearly salary including housing, transport, and other benefits. Salaries vary drastically between different careers. If you are interested in the salary of a particular job, see below for salaries for specific job titles.

10. Massachusetts

According to state police, Massachusetts’s minimum wage has to be at least $.50 more than the federal minimum wage, and the state has gone well beyond $7.25. As part of the state’s plan to eventually reach the $15 mark in 2023, Massachusetts increased the minimum wage in 2022 from $13.50 to $14.25.

5 states where salaries have risen the most over the past decade

According to the BLS, the average wage for all Americans rose 27% between 2010 and 2020, from $44,410 to $56,310. Four states with the highest-growing salaries top this average wage: Washington, California, Massachusetts and Oregon.

Washington saw the largest increase in its workers’ pay at about 58%. In 2010, Washington’s average annual wage ranked 10th of all the states, but in 2020, its annual wage of $76,791 is the fourth highest in the country. California experienced the second-highest spike in its average annual wage at about 49%. In both states, the percent difference is far higher than salary growth for the country overall.

Other states’ wages have fared worse over the last ten years: Wyoming, Louisiana, Mississippi and Alaska all saw small gains in their states’ average wages.

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