Low-wage workers experienced historically fast wage growth between 2019 and 2024—even after accounting for inflation—according to a new EPI report. Real hourly wages for workers in the 10th percentile grew 15.3% over the five-year period, significantly faster than growth for middle-wage workers (5.8%) and high-wage workers in the 90th percentile (6.9%).
Black and Hispanic workers, young workers, and workers with lower levels of educational attainment saw particularly strong wage growth over the last five years. This resulted in narrowing wage gaps, particularly between Black and white workers, a reversal from previous decades. But significant progress is still needed, as Black workers are still paid 21.6% less than white workers.
These gains are a notable reversal of historic trends that increased wage inequality in the U.S. labor market. Between 1979 and 2019, lower-wage workers experienced only a few short years of strong wage growth that significantly lagged behind the wage growth of higher-wage workers.
As the report explains, the historic wage growth for low-wage workers was no accident. Large government COVID relief and recovery measures, combined with a tight labor market with low unemployment, provided low-wage workers better job opportunities and leverage to see strong wage growth.
Nevertheless, low-wage workers continue to suffer from grossly inadequate wages: The 10th-percentile hourly wage in 2024 was $14.26, or $29,661 annually for a full-time worker. This is not enough to attain a modest yet adequate standard of living in any county or metro area in the United States, according to EPI’s Family Budget Calculator. Policymakers need to strengthen labor standards so that workers can lock in the gains and continue to build on them, even in weaker labor markets.
“Policymakers can choose to prioritize a strong labor market that continues to deliver these gains for lower-wage and historically marginalized demographic groups. Unfortunately, the Trump administration’s recent actions will put downward pressure on wage growth and raise the risk of a recession. Policymakers should oppose the attacks on the public sector and reject cuts to benefit programs like Medicaid that are critical parts of the safety net for low-wage workers and their families,” said EPI senior economist Elise Gould.