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Economy / Money

California Gas Prices Are Most Expensive, but You’ll Work Longer in These States To Afford It

By David Nadelle

June 10, 2022

DjelicS / iStock.com

It’s a well-known fact that California has the highest gas prices in the country, much higher than today’s national average price for regular grade gas. In some parts of the state, higher than the federal minimum hourly wage. However, for non-Californians thinking “it serves them right for living in the land of milk and honey,” California residents might not have it as bad at the pumps as you may think.

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According to a CNN study, wages dictate gas prices to a very significant degree. For example, as incredible as California gas prices seem, its residents don’t bear as big of a brunt as workers in other states due to earning a higher average hourly wage. For its study, CNN used the national average gas price (on that day) and the May national wage estimate to find that, with the exception of Massachusetts workers who only have to work 1 hour and 55 minutes to afford 15 gallons of regular gas, workers earning the state average wage need to work between 2 hours and 4 minutes (Colorado) and 2 hours and 57 minutes (Nevada) to buy 15 gallons of gas.

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Taking a cue from the CNN study, GOBankingRates figured how long workers making minimum wage — far less than the state average hourly wage — would need to spend on the job to buy 10 gallons of regular gas in their state. As of June 10, AAA calculated national average cost for regular unleaded gasoline at $4.986, and $5.753 for diesel. Once again, both are the highest recorded average prices. The federal minimum hourly wage of $7.25 per hour has been unchanged since 2009, when it was raised from $6.55 per hour.

The following list ranks each state according to how many hours you need to work to buy 10 gallons of gas in your state:

50. Massachusetts

49. New York

48. Washington

47. Connecticut

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46. Colorado

45. New Jersey

44. Maine

43. Maryland

42. Vermont

41. Rhode Island

40. Arkansas

39. Missouri

38. Arizona

37. New Mexico

36. Oregon

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35. Virginia

34. California

33. Minnesota

32. Illinois

31. South Dakota

30. Delaware

29. Florida

28. Nebraska

27. Montana

26. Michigan

25. Alaska

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24. Ohio

23. Hawaii

22. West Virginia

21. Nevada

20. Georgia

19. Mississippi

18. Louisiana

17. Oklahoma

16. South Carolina

15. Kansas

14. Alabama

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13. Tennessee

12. Texas

11. North Carolina

10. North Dakota

9. Wyoming

8. Iowa

7. Kentucky

6. Wisconsin

5. New Hampshire

4. Utah

3. Pennsylvania

2. Idaho

1. Indiana

Obviously, working in states that have a lower minimum wage means you have to work more to afford gas. When we look at the Dakotas, for example, we can see how impactful minimum wage is to buying power. Gas costs the same in both, yet because South Dakota’s minimum wage is more than $2.00 higher than North’s bottom level minimum wage of $7.25, Southerners work less time to buy more.

Employers in states that do not have a minimum wage (Alabama, Louisiana, Mississippi, South Carolina and Tennessee) or that have a minimum wage below the federal minimum wage (Georgia and Wyoming) are subject to the Fair Labor Standards Act and required to pay their employees at least the current federal minimum wage of $7.25 per hour, per the Department of Labor.

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It’s evident from the data that the federal minimum wage is vitally important to the personal finances of millions of workers despite state gas prices. Wages are most important to those living in one of the 20 states where minimum wage is $7.25 \per hour. When gas prices and inflation are at their current staggering highs, minimum wage earners get hit the hardest.

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