The US states where salaries are rising fastest
Daniel Coughlin
05 February 2019
Need a raise? Discover which states you should head to
US wage growth hit a nine-year high last year, easily outpacing inflation, which stood at 1.9% at the end of the year. But salaries aren't increasing spectacularly in every state, though several have seen hikes exceeding 7%. Using data compiled by the US Bureau of Labor Statistics, we've ranked each state and DC based on the change in the average private sector hourly pay rate from December 2017 to December 2018.
Alaska: +0.1%
Wages actually stagnated last year for private sector workers in high-unemployment Alaska as a whole. Employees in the Last Frontier had a barely noticeable raise of 0.1% in 2018, which may explain the slight increase in the typical working week, which lengthened from 34.1 hours to 34.8. Be that as it may, Fairbanks managed to buck the trend, with workers there enjoying an increase of 8.8%.
Rhode Island: +1.1%
Down in L'il Rhody, private sector workers saw their salaries increase by a relatively meager 1.1% on average. Living costs in the smallest state in the union are anything but modest, so this below-inflation raise hasn't done its workforce any favors, particularly lower-paid employees who are struggling to pay their bills.
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Indiana: +1.3%
Typical wages increased by a disappointing 1.3% across the Hoosier State last year, but huge disparities exist depending on the location. Wage growth in the Lafayette area, which has a tighter job market, lower unemployment and more service industries than many other parts of Indiana, surged by 13.9%. In contrast, average salaries in the more manufacturing-dependent Evansville fell by 8.8%.
New Hampshire: +1.4%
Despite an increase in jobs, wage growth was sluggish last year across New Hampshire, which can be partly explained by its low and frozen minimum wage, which lags behind neighboring states. On a local level, paychecks shrunk by a hefty 7% on average in Portsmouth, though private sector workers in the Dover-Durham metro area enjoyed an average raise of 6.8%.
Maryland: +1.5%
Staying with below-inflation raises, salaries in Maryland rose by just 1.5% on average in 2018, though the typical state-wide working week remained unchanged at 34.4 hours. Nevertheless, private sector workers in affluent California-Lexington Park put in an additional 3.5 hours a week last year, presumably to make up for the drop in their hourly rate, which fell by a painful 9.2%.
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Arizona: +1.8%
Likewise, pay across Arizona failed to keep pace with inflation in 2018, falling short by 0.1%. Still, as is the case in many other states, location is key. While private sector workers in Lake Havasu City-Kingman saw their paychecks decline by 3.9% typically, their counterparts in the Sierra Vista-Douglas MSA were treated to a bumper raise of 31.7%, the most generous in the nation.
Delaware: +2%
Delaware is among the 44 states where average pay rose above the rate of inflation in 2018. Denizens of Dover who work in the private sector however haven't been quite so lucky, despite the metro area topping the state in terms of job creation. In fact, wages there dropped by 0.2% on average in 2018.
Idaho: +2.2%
Next up is Idaho. The typical working week in the Gem State increased from 33.6 to 34.3 hours in 2018, and average pay grew by 2.2%, beating inflation. The most impressive raise was seen in the city of Lewiston, where demand is strong for jobs in healthcare and transportation. Wages over the 12-month period rose by a not too shabby 7.4%.
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Wisconsin: +2.2%
Job seekers headed for Wisconsin, where average wages per hour rose by 2.2% in 2018, may want to steer clear of Racine and make a beeline for the Janesville-Beloit MSA instead. Average pay in Racine actually dropped by 4.2% last year, while wages in Janesville-Beloit increased by a very decent 11.2%.
Montana: +2.6%
It's a similar situation over in Montana. Though wages state-wide increased by 2.6%, large disparities exist. Living up to its name, Great Falls saw a nosedive in the average wage, which declined by 9.2% in 2018. In contrast, private sector workers in Missoula enjoyed a raise of 10.6% typically.
Iowa: +2.8%
Thinking about relocating to Iowa? Ames is the place to be for job seekers. Wages in the metro area, which has the lowest unemployment rate in the country, increased by 3.8% in 2018, beating the state average, and the city was recognized by CNBC last year as having America's best metro job market. Ames has also featured on SmartAsset's 'Top 10 Cities for Career Opportunities' list for the past three years.
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Louisiana: +2.8%
Louisiana's average private sector wage grew by 2.8%, mirroring the growth rate in Iowa. The working week in the state increased in 2018 too. The private sector workforce put in a typical working week of 36.5 hours in December of last year, up from 35.4 hours during the same period in 2017.
Mississippi: +2.9%
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Average hourly pay in Mississippi is the lowest in the land, coming in at $20.91 in December 2018, but everything from housing to groceries and transportation is refreshingly affordable in the Magnolia State, and typical wages increased by an above-inflation 2.9% in the 12-month period from December 2017.
New Jersey: +3%
The private sector workforce in New Jersey earn almost $10 more per hour on average than employees in Mississippi, though the cost of living in the state is considerably higher. Last year, average wages there increased by 3% and the working week grew by 48 minutes typically.
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Arkansas: +3.1%
Arkansas is another state where the average pay hike differs strikingly depending on the location. In Pine Bluff, for instance, typical wages plummeted by 9.5% in 2018, while private sector workers in the Fayetteville-Springdale-Rogers MSA, which has experienced buoyant job growth, saw a salary increase of 9.1% on average.
Oregon: +3.4%
Though wage growth in Oregon last year fell behind that of neighboring Nevada, California and Washington, average pay did increase by an inflation-surpassing 3.4%. Hotspots for rising private sector pay in the Beaver State include the Corvallis and Eugene metro areas, which enjoyed raises of 5% and 4.4% respectively.
Massachusetts: +3.5%
The cost of living in wealthy Massachusetts is on the expensive side, so private sectors workers in the state could clearly do with a raise compared to employees in other less pricey states. Fortunately, average pay there increased by 3.5% in 2018, with typical salaries rising by 11.7% in the Springfield MSA.
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Missouri: +3.5%
Average pay increased by 3.5% in Missouri during the 12-month period from December 2017 to December 2018. Private sector workers in St. Joseph had the biggest raise at 12.6%. The jobless rate in the metro area was just 2.8% in December, well below the nationwide rate of 3.9%, which has served to tighten the labor market and drive up wages.
Texas: +3.5%
The typical working week in Texas increased from 35.9 to 36.4 hours last year, and average pay rose too. But not all private sector workers in the Lone Star State have joined in the party. Spare a thought for the working folks of Wichita Falls as they have seen their paychecks reduce by 2.6% on average.
Maine: +3.6%
Super-low unemployment and a tight labor market have been pushing up wages in Maine, particularly in the Bangor metro area. Though pay went up by 3.6% on average in 2018 across the northeastern state, salaries increased by just over 4% in Bangor during the 12-month period from December 2017.
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North Dakota: +3.6%
North Dakota's private sector workforce toiled away for an additional hour a week in 2018, swelling pay packets in the state, and hourly wages grew on average by 3.6% last year. Even Grand Forks, the metro area with the most modest increase in pay per hour, still managed to record an above-inflation raise of 2%.
Pennsylvania: +3.6%
Unlike North Dakota, average wages on a local level are all over the place in Pennsylvania, though the typical rate of pay per hour state-wide increased by 3.6% in 2018. By way of example, salaries across the board in the Harrisburg-Carlisle MSA were hiked up by 7.8% last year, but average wages in Altoona dropped by 5.3%.
Georgia: +3.7%
The situation is even more pronounced down in Georgia. While average pay per hour increased by 3.7% in the state overall during the 12-month period up to December 2018, typical wages in the Columbus metro area skyrocketed by 12.1%, yet average pay in the Hinesville MSA fell by a budget-busting 8.7%.
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Kentucky: +3.7%
Average wages rose by 3.7% in Kentucky in 2018. If you're considering a move to the state, you might want to think about relocating to the Lexington-Fayette MSA. The typical hourly rate of pay soared in this particular metro area by 7% last year, and the unemployment rate there in December was considerably below the nationwide average at just 2.9%.
Nebraska: +3.9%
Nebraskans employed in the private sector were significantly better off last year. As well as working just under an extra hour per week on average in 2018, they benefited from an increase in their hourly pay rate of 3.9% on average, which is of course considerably above the national inflation figure of 1.9%.
Utah: +3.9%
Private sector workers across Utah also enjoyed a raise of 3.9% typically last year. Unsurprisingly, Provo-Orem, the metro area with the state's lowest jobless rate, recorded the most impressive increase in average hourly pay. Employees there saw their salaries go up by 9.5% in 2018.
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Alabama: +4%
The Alabama workforce put in ever so slightly longer hours per week last year, but private sector employees in the state also enjoyed an increase in their hourly rate on average, with the typical wage rising from $23.05 per hour in December 2017 to $23.96 during the same period 12 months down the line.
Florida: +4%
By contrast, private sector workers in Florida put in a slightly shorter working week in 2018 but, like their fellow workers in Alabama, they saw their hourly rate of pay increase by 4% on average. Locally, employees in Homosassa Springs did even better – their wages soared by 25.8% typically last year.
Michigan: +4%
Contemplating a move to Michigan? Jobs are actually pretty plentiful these days in the state, which recorded its lowest rate of unemployment for years in October at just 3.8%, down from a high of 14.6% in June 2009. Wages are rising nicely to boot, up 4% statewide in 2018 based on the typical hourly rate.
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Vermont: +4%
The labor market is even tighter in Vermont, where the unemployment rate stood at just 2.7% in December of last year, down from an already ultra-low 2.9% in December 2017. Needless to say, job opportunities abound and, as a result, average wages across the Green Mountain State increased by 4% in 2018.
New Mexico: +4.3%
Private sector workers in the state of New Mexico are doing just fine as well. They are working longer weeks on average, but earning more cash per hour. The typical hourly rate rose from $21.57 in December 2017 to a welcome $22.49 in December of last year, outpacing inflation and then some.
Ohio: +4.5%
If you're planning a move to the Buckeye State, you'd be wise to avoid the Weirton-Steubenvill MSA and put Toledo on your shortlist instead. While the typical hourly rate state-wide increased by 4.5% in 2018, wages in Weirton-Steubenvill declined by a dramatic 9.7%, and pay in Toledo rose by 9.8%.
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Virginia: +4.6%
The typical working week was shorter last year in Virginia, but private sector workers could afford to work fewer hours if the increase in average state-wide pay is anything to go by. Sprinting ahead of inflation, typical wages per hour went up from $27.75 in December 2017 to $29.02 in December 2018.
Kansas: +4.7%
Like its far more famous namesake in New York City, the Manhattan MSA in Kansas has a labor market that is positively booming. Though typical wages across Kansas increased by 4.7% last year, the average hourly rate of pay in Manhattan, where unemployment is extremely low, rose by 21.8%.
New York: +4.8%
Manhattan, Kansas actually beat its New York City namesake in terms of wage growth, but private sector workers in the Big Apple and the state of New York as a whole had a lot to be thankful for last year. Typical salaries across the state increased by an inflation-surpassing 4.8% in the 12-month period from December 2017.
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Minnesota: +4.9%
Over in Minnesota, private sector workers did a little bit better in 2018. Looking at the state as a whole, the workforce had a very nice raise of 4.9%. But disparities on a local level were marked. Workers in the Duluth metro area saw their salaries rise by 9.5%, while the Rochester workforce experienced a drop of 6.7%.
South Dakota: +4.9%
South Dakota's private sector working population scored a raise of 4.9% last year, and the typical working week increased from 31.7 to 33.7 hours, making for fatter paychecks. The biggest raise was in the Sioux Falls MSA, where the average hourly rate increased from $22.44 to $24, a hike of 7%.
Colorado: +5.3%
The working week lengthened only marginally in Colorado last year, but private sector employees there bagged an even larger raise on average compared to those in South Dakota. Their wages increased by 5.3% in the 12-month period following December 2017. Boulder was the major employment hotspot with a rate per hour increase of 14.7%.
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Tennessee: +5.4%
Unemployment increased last year in Tennessee, rising from 3.3% in December 2017 to 3.6% during the same period in 2018, but the number of people out of work in the Volunteer State remains historically low, and wage growth there has been very robust, hitting 5.4% at the end of 2018.
California: +5.5%
Californians worked a longer week typically last year, but their average hourly pay rate increased by 5.5%. No wonder consumer spending is up in the Golden State. The biggest raise was in the Redding metro area, where salaries increased by a very respectable 11.6%, and cities including Los Angeles and Napa also reported substantial hikes.
South Carolina: +5.5%
Unlike the working population in California, private sector employees in South Carolina actually worked fewer hours in 2018 overall, but their wages also rose by a wallet-friendly 5.5%. In Spartanburg, where BMW is in the process of creating 1,000 jobs, typical salaries increased by 13.5% last year.
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North Carolina: +5.6%
The average increase in hourly pay was even more impressive in North Carolina last year, rising from $24.28 in December 2017 to $25.64 in December just gone. The labor market is strongest in the Greenville MSA, where the unemployment rate fell to just 2.9% in December and wages were up 16% compared to the same period in 2017.
Oklahoma: +5.6%
Oklahoma's workforce can afford to hike up their spending this year thanks to an average wage raise of 5.6% and an increase in the hours worked per week. Oklahoma City is the place to be if you're looking to relocate. Typical pay was up 9.5% in the metro area in December 2018 compared to December 2017.
Illinois: +5.7%
At 4.3%, the rate of unemployment in Illinois was above the national average of 3.9% in December 2018, but that didn't stop the Prairie State's dynamic wage growth from stalling. The typical hourly pay rate according to the US Bureau of Labor Statistics increased from $27.09 in December 2017 to $28.62 at the end of 2018, a hike of 5.7%.
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West Virginia: +5.7%
Average wages in West Virginia may not be as generous as those in Illinois, but private sectors workers were treated to a raise of 5.7% typically in 2018, reflecting the situation in the Midwestern state. Though wage growth was actually negative in the Beckley MSA, salaries rose by 11.10% in the Morgantown metro area.
Hawaii: +6.3%
The cost of living may be sky-high, but Hawaii is the state with America's second lowest rate of unemployment – it stood at just 2.5% in December. The glut of jobs has done wonders for private sector wages, pushing them up by 6.3% on average in the 12-month period following December 2017.
Washington: +6.4%
Tempted to move to Washington State? You might want begin your job search in the Walla Walla metro area. Though state-wide private sector salaries increased by a lucrative 6.4% in 2018, Walla Walla's workers enjoyed the biggest raise. Their hourly rate of pay jumped from $23.08 in December 2017 to $26.68 at the end of last year.
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Wyoming: +6.9%
Wage growth in Wyoming, which is experiencing a severe labor shortage, has also been eye-opening. Compared with December 2017, the hourly rate for workers in the private sector leaped by 6.9% in December of last year. Salary increases haven't been as awesome though in the Cheyenne metro area, where average pay went up by a relatively mediocre 3.7%.
Connecticut: +7.4%
One of America's most affluent states, Connecticut isn't a cheap place to live, but average pay is high for most jobs, and wage growth over the 12-month period from December 2017 has been nothing short of phenomenal. Typically, private sector workers in the state have enjoyed a raise of 7.4%.
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Nevada: +7.5%
Like the luckier gamblers that flock to the state, Nevada's private sector workforce landed something of a windfall in 2018. The average wage in the Silver State increased by 7.5%, and employees in Reno did even better – their hourly rate rose from $23.22 in December 2017 to $25.05 a year down the line, a hike of 7.8%.
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DC: +7.7%
As well as boasting the nation's highest wages by a long-shot – the typical hourly rate for DC private sector workers in December was a remarkable $44.96 – the nation's capital saw the most spectacular wage growth in the country in 2018, once of course individual metro areas are discounted, as pay increased by an average of 7.7% year-on-year.
Now take a look at the minimum wage in every state and DC in 2019