The Geography of Pay: What Every State Earns

The Bureau of Labor Statistics surveys approximately 1.1 million establishments every year through its Occupational Employment and Wage Statistics program. The result is the most granular wage map in existence: median pay for every occupation, in every state, in every metropolitan area. At the broadest level — all occupations combined — the data reveals how dramatically where you live shapes what you earn.

The national median annual wage across all occupations in 2024 was $49,500. But that single number papers over a spread that runs from $88,000 in the District of Columbia to $39,070 in Mississippi. The ratio between the highest and lowest is 2.3 to 1, meaning a median worker in D.C. earns more than twice what a median worker in Mississippi takes home. That gap has persisted for decades, and it reflects deep structural differences in industry mix, cost of living, educational attainment, and the concentration of federal and professional services.

The chart below ranks every state plus D.C. by median annual wage. The patterns are stark: coastal states dominate the top, Southern states cluster at the bottom, and a remarkably compressed middle band of 20 states falls within a $3,000 range of each other.

Washington, D.C. is in a league of its own. At $88,000, the District’s median exceeds the second-place state, Massachusetts, by more than $25,000. This is not a surprise to anyone who has watched the federal city evolve: D.C.’s workforce is dominated by the federal government, law firms, lobbying organizations, think tanks, and government contractors. These are among the highest-paying industries in the country, and they are geographically concentrated in a single 68-square-mile jurisdiction with essentially no manufacturing, agriculture, or low-wage rural employment to drag the median down.

Massachusetts ($62,270) and Washington State ($61,590) round out the top three. Massachusetts benefits from its biotech corridor, financial services sector, and the wage-inflating gravity of Boston’s universities and hospitals. Washington State rides the Seattle tech boom — Amazon, Microsoft, and their supply chain lift wages across the board.

Alaska at number four ($59,400) is the outlier that proves the rule: its high median reflects oil industry wages, hazard pay premiums, and the sheer cost of living in the nation’s most remote state. Groceries, housing, and transportation all cost more in Anchorage, and wages adjust accordingly.

At the other end, Mississippi ($39,070) stands alone at the bottom, the only state where the median worker earns less than $40,000 a year. Arkansas ($41,020), West Virginia ($43,320), and Louisiana ($43,770) are not far behind. These states share common characteristics: a heavier reliance on agriculture, extraction, and low-wage services; lower population density; fewer corporate headquarters; and lower cost of living that simultaneously reflects and reinforces lower pay.

Eight of the bottom ten states are in the South. This is the most durable geographic pattern in American wages: the Sun Belt discount. Lower unionization rates, right-to-work laws, a historical reliance on agriculture and light manufacturing, and lower costs of living all contribute. The question of whether workers in these states are worse off depends entirely on whether you measure in nominal dollars or purchasing power — a distinction we return to below.

Two states that routinely make headlines for their economic dynamism rank lower than most people expect. Texas, with more Fortune 500 headquarters than any state, ranks 31st at $47,500. The Lone Star State’s economy is vast and diverse, but its median is pulled down by enormous low-wage service, retail, and agricultural sectors, particularly along the border and in rural areas. Dallas and Houston pay well; the state as a whole is average.

Florida ranks even lower, at 36th ($46,860). The Sunshine State’s tourism-heavy economy — hotels, restaurants, theme parks, cruise lines — generates millions of jobs, but hospitality is the lowest-paying major industry in the country. Florida also lacks a state income tax, which attracts retirees and wealth but does not necessarily raise the median worker’s paycheck.

Perhaps the most striking feature of the middle of the distribution is its compression. Twenty states fall between $46,000 and $49,000 — a band just $3,000 wide. From Pennsylvania (26th at $48,550) to Nevada (40th at $46,440), one state’s median barely differs from the next. The dramatic gaps are at the extremes; the American middle is tightly clustered.

These are nominal figures — raw dollars, unadjusted for the cost of living. And the cost-of-living caveat matters enormously in geographic wage comparisons. $62,270 in Massachusetts buys less than $48,000 in Iowa after adjusting for housing, groceries, transportation, and taxes. The Bureau of Economic Analysis publishes Regional Price Parities that quantify this: Massachusetts’s prices run about 10% above the national average, while Iowa’s run about 10% below.

This means that much of the apparent geographic wage gap reflects cost-of-living differences rather than genuine prosperity differences. A nurse in Mississippi earning $39,000 may have a comparable standard of living to a nurse in California earning $56,000, because the Mississippi nurse’s rent is one-third the California nurse’s. Geographic wage data, like all wage data, requires context.

That said, the adjustment does not erase the gap entirely. Even in cost-adjusted terms, D.C. and Massachusetts workers have higher purchasing power than Mississippi workers. High-wage states tend to have both higher costs and higher real incomes; low-wage states tend to have lower costs but also lower real incomes. The discount is real, but it is smaller than the nominal numbers suggest.

The OEWS program also covers U.S. territories. Puerto Rico’s median annual wage of $27,030 is just 55% of the national figure and $12,000 below Mississippi, the lowest-ranking state. The Virgin Islands ($41,550) and Guam ($35,000) fall in between. These territories face unique economic challenges — limited industry diversity, geographic isolation, and in Puerto Rico’s case, a debt crisis that has constrained public-sector wages for over a decade.