Texans like to brag about the many jobs created in their state. When residents of other states tire of it, they sneer about how those Texas jobs don’t pay much, pointing to Bureau of Labor Statistics data that put Texas far from the top in median hourly wages.
The BLS numbers rank Texas 28th among the states, with a median wage of $15.14 an hour. At the top of the heap are Massachusetts, Alaska, Connecticut, Maryland, Washington, New Jersey, New York, and California—all over $18 an hour.
Wages vary for many reasons—differences among states in years of schooling and types of industries, for example. They also vary because employers have to pay more to attract workers in states with high living costs and high taxes.
To put states on an equal footing, we adjust median wages using a customized version of the Missouri Department of Economic Development’s cost of living index, augmented with Tax Foundation data on state tax burdens.
In this new ranking, several states take prodigious drops, their high pay turning into illusion. California, New Jersey, New York, and Rhode Island were among the top 10 in the raw data on median wages. Now they’re in the bottom 10—keeping company with Mississippi and Montana.
Texas vaults from No. 28 in the raw data to eighth in the reshuffled Top 10. Relatively affordable housing helps keep the state’s cost of living low, and Texas residents don’t pay any state income taxes. Texas workers aren’t afflicted with a money illusion; they know their paychecks go farther in terms of what matters most—the standard of living.
| STATE | RAW WAGES ($ Per Hour) | ADJUSTED WAGES (Cost of Living, Including Taxes) |
|---|---|---|
| Massachusetts | $20.13 | $17.04 |
| Alaska | $20.02 | $16.63 |
| Connecticut | $19.56 | $15.06 |
| Maryland | $19.11 | $16.25 |
| Washington | $18.76 | $19.37 |
| New Jersey | $18.69 | $14.74 |
| New York | $18.69 | $14.66 |
| California | $18.21 | $15.01 |
| Colorado | $17.68 | $18.49 |
| Rhode Island | $17.39 | $14.62 |
| Minnesota | $17.30 | $17.73 |
| Deleware | $17.26 | $17.43 |
| Virginia | $17.18 | $18.84 |
| Hawaii | $17.06 | $10.69 |
| Illinois | $16.87 | $18.37 |
| Wyoming | $16.84 | $17.82 |
| New Hampshire | $16.70 | $15.03 |
| Oregon | $16.58 | $16.32 |
| Pennsylvania | $16.27 | $16.89 |
| Michigan | $16.26 | $17.84 |
| Vermont | $15.97 | $14.04 |
| Arizona | $15.89 | $16.41 |
| Wisconsin | $15.78 | $16.56 |
| Nevada | $15.47 | $17.53 |
| Ohio | $15.45 | $17.31 |
| Maine | $15.28 | $14.40 |
| Georgia | $15.20 | $17.04 |
| Texas | $15.14 | $17.63 |
| Utah | $15.04 | $17.02 |
| North Carolina | $14.95 | $16.30 |
| Indiana | $14.85 | $17.00 |
| Missouri | $14.78 | $16.80 |
| Kansas | $14.71 | $16.76 |
| Florida | $14.71 | $15.77 |
| Iowa | $14.60 | $16.25 |
| Nebraska | $14.57 | $16.65 |
| Idaho | $14.54 | $16.61 |
| North Dakota | $14.50 | $15.79 |
| Louisiana | $14.50 | $16.29 |
| Kentucky | $14.47 | $16.88 |
| New Mexico | $14.45 | $15.84 |
| Tennessee | $14.38 | $17.06 |
| South Carolina | $14.33 | $15.84 |
| Alabama | $14.21 | $16.38 |
| Montana | $13.95 | $15.00 |
| Oklahoma | $13.89 | $16.37 |
| South Dakota | $13.42 | $14.70 |
| Arkansas | $13.39 | $15.37 |
| West Virginia | $13.19 | $15.11 |
| Mississippi | $12.83 | $14.65 |
