The Gap Between Minimum Wage and the Cost of Living in Every State
Written by
J. David Herman
Edited by
Rebekah Evans
IcemanJ / Getty Images/iStockphoto
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“Minimum wage” and “living wage” aren’t just different concepts. They are also often very far apart.
In all 50 U.S. states and the District of Columbia, state minimum-wage income falls short of the average cost of living. In many cases, far short. That’s according to a new GOBankingRates study comparing the two.
In the states where a minimum wage job will get you closest to paying your bills, you’ll still come up about $14,000 short each year. In another state, the gap is $73,000 and you would have to work 2 1/2 minimum wage jobs, just to match the average cost of living.
Multiple states don’t have minimum wage laws and default to the national minimum wage. Of the 50 states and the District of Columbia, 20 match the $7.25-an-hour minimum prescribed by federal law.
The national minimum wage hasn’t increased since July 24, 2009 — nearly 25 years. Efforts to boost the rate to $15.00 an hour have been introduced in each session of Congress since 2017 but so far have failed to pass.
Two states have different minimum wages depending on circumstances. Minnesota differentiates between large employers and small employers. The state of New York has different minimums for inside and outside of New York City.
Minimum wage laws at city and other levels may also apply. The city of Tukwila, Washington — a Seattle suburb — had the highest minimum wage in the nation as of January ($20.29 per hour for large employers and $18.29 for mid-sized employers.) Seattle was close behind at $19.97 an hour for companies with more than 500 employees.
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Here’s a look at each state’s minimum wage, monthly average total cost of living, monthly income for minimum wage and average monthly gap; plus each state’s annual average total cost of living, annual income for minimum wage and average annual gap.
Alabama
- State minimum wage: $7.25
- Monthly average total cost of living: $3,233
- Minimum wage monthly income: $1,257
- Average monthly gap: -$1,977
- Annual average total cost of living: $38,799
- Minimum wage annual income: $15,080
- Average annual gap: -$23,719
Alaska
- State minimum wage: $11.73
- Monthly average total cost of living: $4,923
- Minimum wage monthly income: $2,033
- Average monthly gap: -$2,890
- Annual average total cost of living: $59,073
- Minimum wage annual income: $24,398
- Average annual gap: -$34,675
Arizona
- State minimum wage: $14.35
- Monthly average total cost of living: $4,661
- Minimum wage monthly income: $2,487
- Average monthly gap: -$2,174
- Annual average total cost of living: $55,937
- Minimum wage annual income: $29,848
- Average annual gap: -$26,089
Arkansas
- State minimum wage: $11.00
- Monthly average total cost of living: $3,067
- Minimum wage monthly income: $1,907
- Average monthly gap: -$1,161
- Annual average total cost of living: $36,807
- Minimum wage annual income: $22,880
- Average annual gap: -$13,927
California
- State minimum wage: $16.00
- Monthly average total cost of living: $7,168
- Minimum wage monthly income: $2,773
- Average monthly gap: -$4,395
- Annual average total cost of living: $86,017
- Minimum wage annual income: $33,280
- Average annual gap: -$52,737
Colorado
- State minimum wage: $14.42
- Monthly average total cost of living: $5,384
- Minimum wage monthly income: $2,499
- Average monthly gap: -$2,884
- Annual average total cost of living: $64,604
- Minimum wage annual income: $29,994
- Average annual gap: -$34,610
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Connecticut
- State minimum wage: $15.69
- Monthly average total cost of living: $4,767
- Minimum wage monthly income: $2,720
- Average monthly gap: -$2,047
- Annual average total cost of living: $57,204
- Minimum wage annual income: $32,635
- Average annual gap: -$24,569
Delaware
- State minimum wage: $13.25
- Monthly average total cost of living: $4,344
- Minimum wage monthly income: $2,297
- Average monthly gap: -$2,048
- Annual average total cost of living: $52,134
- Minimum wage annual income: $27,560
- Average annual gap: -$24,574
District of Columbia
- District minimum wage: $17.50
- Monthly average total cost of living: $6,530
- Minimum wage monthly income: $3,033
- Average monthly gap: -$3,497
- Annual average total cost of living: $78,360
- Minimum wage annual income: $36,400
- Average annual gap: -$41,960
Florida
- State minimum wage: $12.00
- Monthly average total cost of living: $4,462
- Minimum wage monthly income: $2,080
- Average monthly gap: -$2,382
- Annual average total cost of living: $53,545
- Minimum wage annual income: $24,960
- Average annual gap: -$28,585
Georgia
- State minimum wage: $7.25
- Monthly average total cost of living: $3,903
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,646
- Annual average total cost of living: $46,831
- Minimum wage annual income: $15,080
- Average annual gap: -$31,751
Hawaii
- State minimum wage: $14.00
- Monthly average total cost of living: $8,508
- Minimum wage monthly income: $2,427
- Average monthly gap: -$6,081
- Annual average total cost of living: $102,098
- Minimum wage annual income: x $29,120
- Average annual gap: -$72,978
Idaho
- State minimum wage: $7.25
- Monthly average total cost of living: $4,719
- Minimum wage monthly income: $1,257
- Average monthly gap: -$3,462
- Annual average total cost of living: $56,626
- Minimum wage annual income: $15,080
- Average annual gap: -$41,546
Illinois
- State minimum wage: $14.00
- Monthly average total cost of living: $3,555
- Minimum wage monthly income: $2,427
- Average monthly gap: -$1,128
- Annual average total cost of living: $42,659
- Minimum wage annual income: $29,120
- Average annual gap: -$13,539
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Indiana
- State minimum wage: $7.25
- Monthly average total cost of living: $3,433
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,177
- Annual average total cost of living: $15,080
- Minimum wage annual income: $41,200
- Average annual gap: -$26,120
Iowa
- State minimum wage: $7.25
- Monthly average total cost of living: $3,301
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,044
- Annual average total cost of living: $39,611
- Minimum wage annual income: $15,080
- Average annual gap: -$24,531
Kansas
- State minimum wage: $7.25
- Monthly average total cost of living: $3,312
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,055
- Annual average total cost of living: $39,740
- Minimum wage annual income: $15,080
- Average annual gap: -$24,660
Kentucky
- State minimum wage: $7.25
- Monthly average total cost of living: $3,140
- Minimum wage monthly income: $1,257
- Average monthly gap: -$1,884
- Annual average total cost of living: $37,682
- Minimum wage annual income: $15,080
- Average annual gap: -$22,602
Louisiana
- State minimum wage: $7.25
- Monthly average total cost of living: $3,097
- Minimum wage monthly income: $1,257
- Average monthly gap: -$1,840
- Annual average total cost of living: $37,161
- Minimum wage annual income: $15,080
- Average annual gap: -$22,081
Maine
- State minimum wage: $14.15
- Monthly average total cost of living: $4,501
- Minimum wage monthly income: $2,453
- Average monthly gap: -$2,049
- Annual average total cost of living: $54,017
- Minimum wage annual income: $29,432
- Average annual gap: -$24,585
Maryland
- State minimum wage: $15.00
- Monthly average total cost of living: $4,642
- Minimum wage monthly income: $2,600
- Average monthly gap: -$2,042
- Annual average total cost of living: $55,705
- Minimum wage annual income: $31,200
- Average annual gap: -$24,505
Massachusetts
- State minimum wage: $15.00
- Monthly average total cost of living: $6,228
- Minimum wage monthly income: $2,600
- Average monthly gap: -$3,628
- Annual average total cost of living: $74,738
- Minimum wage annual income: $31,200
- Average annual gap: -$43,538
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Michigan
- State minimum wage: $10.33
- Monthly average total cost of living: $3,412
- Minimum wage monthly income: $1,791
- Average monthly gap: -$1,622
- Annual average total cost of living: $40,949
- Minimum wage annual income: $21,486
- Average annual gap: -$19,463
Minnesota (small employers)
- State minimum wage: $8.85
- Monthly average total cost of living: $4,055
- Minimum wage monthly income: $1,534
- Average monthly gap: -$2,521
- Annual average total cost of living: $48,657
- Minimum wage annual income: $18,408
- Average annual gap: -$30,249
Minnesota (large employers)
- State minimum wage: $10.85
- Monthly average total cost of living: $4,055
- Minimum wage monthly income: $1,881
- Average monthly gap: -$2,174
- Annual average total cost of living: $48,657
- Minimum wage annual income: $22,568
- Average annual gap: -$26,089
Mississippi
- State minimum wage: $7.25
- Monthly average total cost of living: $2,924
- Minimum wage monthly income: $1,257
- Average monthly gap: -$1,667
- Annual average total cost of living: $35,090
- Minimum wage annual income: $15,080
- Average annual gap: -$20,010
Missouri
- State minimum wage: $12.30
- Monthly average total cost of living: $3,355
- Minimum wage monthly income: $2,132
- Average monthly gap: -$1,223
- Annual average total cost of living: $40,265
- Minimum wage annual income: $25,584
- Average annual gap: -$14,681
Montana
- State minimum wage: $10.30
- Monthly average total cost of living: $4,827
- Minimum wage monthly income: $1,785
- Average monthly gap: -$3,041
- Annual average total cost of living: $57,921
- Minimum wage annual income: $21,424
- Average annual gap: -$36,497
Nebraska
- State minimum wage: $12.00
- Monthly average total cost of living: $3,497
- Minimum wage monthly income: $2,080
- Average monthly gap: -$1,417
- Annual average total cost of living: $41,970
- Minimum wage annual income: $24,960
- Average annual gap: -$17,010
Nevada
- State minimum wage: $12.00
- Monthly average total cost of living: $4,787
- Minimum wage monthly income: $2,080
- Average monthly gap: -$2,707
- Annual average total cost of living: $57,445
- Minimum wage annual income: $24,960
- Average annual gap: -$32,485
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New Hampshire
- State minimum wage: $7.25
- Monthly average total cost of living: $5,257
- Minimum wage monthly income: $1,257
- Average monthly gap: -$4,000
- Annual average total cost of living: $63,085
- Minimum wage annual income: $15,080
- Average annual gap: -$48,005
New Jersey
- State minimum wage: $15.13
- Monthly average total cost of living: $5,326
- Minimum wage monthly income: $2,623
- Average monthly gap: -$2,704
- Annual average total cost of living: $63,913
- Minimum wage annual income: $31,470
- Average annual gap: -$32,442
New Mexico
- State minimum wage: $12.00
- Monthly average total cost of living: $3,740
- Minimum wage monthly income: $2,080
- Average monthly gap: -$1,660
- Annual average total cost of living: $44,881
- Minimum wage annual income: $24,960
- Average annual gap: -$19,921
New York (within New York City)
- State minimum wage: $16.00
- Monthly average total cost of living: $4,770
- Minimum wage monthly income: $2,773
- Average monthly gap: -$1,997
- Annual average total cost of living: $57,244
- Minimum wage annual income: $33,280
- Average annual gap: -$23,964
New York (outside of New York City)
- State minimum wage: $15.00
- Monthly average total cost of living: $4,770
- Minimum wage monthly income: $2,600
- Average monthly gap: -$2,170
- Annual average total cost of living: $57,244
- Minimum wage annual income: $31,200
- Average annual gap: -$26,044
North Carolina
- State minimum wage: $7.25
- Monthly average total cost of living: $3,974
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,718
- Annual average total cost of living: $47,690
- Minimum wage annual income: $15,080
- Average annual gap: -$32,610
North Dakota
- State minimum wage: $7.25
- Monthly average total cost of living: $3,601
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,344
- Annual average total cost of living: $43,212
- Minimum wage annual income: $15,080
- Average annual gap: -$28,132
Ohio
- State minimum wage: $10.45
- Monthly average total cost of living: $3,395
- Minimum wage monthly income: $1,811
- Average monthly gap: -$1,584
- Annual average total cost of living: $40,742
- Minimum wage annual income: $21,736
- Average annual gap: -$19,006
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Oklahoma
- State minimum wage: $7.25
- Monthly average total cost of living: $3,127
- Minimum wage monthly income: $1,257
- Average monthly gap: -$1,870
- Annual average total cost of living: $37,525
- Minimum wage annual income: $15,080
- Average annual gap: -$22,445
Oregon
- State minimum wage: $14.70
- Monthly average total cost of living: $5,211
- Minimum wage monthly income: $2,548
- Average monthly gap: -$2,663
- Annual average total cost of living: $62,538
- Minimum wage annual income: $30,576
- Average annual gap: -$31,962
Pennsylvania
- State minimum wage: $7.25
- Monthly average total cost of living: $3,646
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,390
- Annual average total cost of living: $43,754
- Minimum wage annual income: $15,080
- Average annual gap: -$28,674
Rhode Island
- State minimum wage: $14.00
- Monthly average total cost of living: $4,905
- Minimum wage monthly income: $2,427
- Average monthly gap: -$2,478
- Annual average total cost of living: $58,856
- Minimum wage annual income: $29,120
- Average annual gap: -$29,736
South Carolina
- State minimum wage: $7.25
- Monthly average total cost of living: $3,731
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,475
- Annual average total cost of living: $44,775
- Minimum wage annual income: $15,080
- Average annual gap: -$29,695
South Dakota
- State minimum wage: $11.20
- Monthly average total cost of living: $3,742
- Minimum wage monthly income: $1,941
- Average monthly gap: -$1,801
- Annual average total cost of living: $44,909
- Minimum wage annual income: $23,296
- Average annual gap: -$21,613
Tennessee
- State minimum wage: $7.25
- Monthly average total cost of living: $3,772
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,515
- Annual average total cost of living: $45,262
- Minimum wage annual income: $15,080
- Average annual gap: -$30,182
Texas
- State minimum wage: $7.25
- Monthly average total cost of living: $3,753
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,496
- Annual average total cost of living: $45,035
- Minimum wage annual income: $15,080
- Average annual gap: -$29,955
Utah
- State minimum wage: $7.25
- Monthly average total cost of living: $5,146
- Minimum wage monthly income: $1,257
- Average monthly gap: -$3,889
- Annual average total cost of living: $61,753
- Minimum wage annual income: $15,080
- Average annual gap: -$46,673
Vermont
- State minimum wage: $13.67
- Monthly average total cost of living: $4,551
- Minimum wage monthly income: $2,369
- Average monthly gap: -$2,181
- Annual average total cost of living: $54,609
- Minimum wage annual income: $28,434
- Average annual gap: -$26,176
Virginia
- State minimum wage: $12.00
- Monthly average total cost of living: $4,391
- Minimum wage monthly income: $2,080
- Average monthly gap: -$2,311
- Annual average total cost of living: $52,688
- Minimum wage annual income: $24,960
- Average annual gap: -$27,728
Washington
- State minimum wage: $16.28
- Monthly average total cost of living: $5,929
- Minimum wage monthly income: $2,822
- Average monthly gap: -$3,107
- Annual average total cost of living: $71,142
- Minimum wage annual income: $33,862
- Average annual gap: -$37,280
West Virginia
- State minimum wage: $8.75
- Monthly average total cost of living: $2,926
- Minimum wage monthly income: $1,517
- Average monthly gap: -$1,410
- Annual average total cost of living: $35,116
- Minimum wage annual income: $18,200
- Average annual gap: -$16,916
Wisconsin
- State minimum wage: $7.25
- Monthly average total cost of living: $3,888
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,631
- Annual average total cost of living: $46,653
- Minimum wage annual income: $15,080
- Average annual gap: -$31,573
Wyoming
- State minimum wage: $7.25
- Monthly average total cost of living: $4,001
- Minimum wage monthly income: $1,257
- Average monthly gap: -$2,745
- Annual average total cost of living: $48,015
- Minimum wage annual income: $15,080
- Average annual gap: -$32,935
Methodology: For this study, GOBankingRates analyzed each U.S. state to determine the difference between the average minimum wage income and the average cost of living. Cost-of-living indexes for each state were sourced from the Missouri Economic and Research Information Center. Using the average expenditure costs for all residents (sourced from the Bureau of Labor Statistics Consumer Expenditure Survey), the average expenditure costs for each state were calculated. The average single-family home value from May 2024 was sourced from the Zillow Home Value Index. By assuming a 10% downpayment and using the national average 30-year fixed mortgage rate, the average monthly mortgage cost was calculated. Using the average mortgage and expenditure cost, the total cost of living for each state was calculated. Minimum wages for each state were sourced from the National Conference of State Legislatures. Using a 40-hour work week over 52 weeks a year, the total average income for minimum wage was calculated. The average annual minimum wage income and average total cost of living were used to find the difference between the two. All data was collected and is up to date as of July 5, 2024.
