Economic Snapshot | Wages, Incomes, and Wealth

State by state, low-wage workers hit hard | EPI Economic Snapshots

A weekly presentation of downloadable charts and short analyses designed to graphically illustrate important economic issues.  Updated every Wednesday.

Snapshot for March 19, 2003.

State by state, low-wage workers hit hard

From 1995 to 2000, for the first time in decades, low-wage workers benefited from strong wage growth. The economic downturn over the last couple of years has begun to take a toll on this wage growth. Workers who enjoyed strong wage growth during the 1990s boom are now facing the slower growth and stagnation that had been the trend in the previous two decades.

Wage growth by state for low-wage workers, 1995-2000

As shown in the first figure (above), low-wage workers in 41 states saw annual wage increases of 1% or more after adjusting for inflation; 28 of those states saw annual growth above 2%. Only nine state had essentially stagnant or declining wages.

Wage growth by state for low-wage workers, 2000-02

But during the recent recession and lackluster recovery, this trend changed significantly (see the second figure above). From 2000 to 2002, the number of states suffering from wage stagnation or declines nearly doubled at 17. Of the 28 states that had seen an average annual growth of over 2% from 1995 to 2000, only six were able to maintain such strong growth through 2002.

This week’s Snapshot by EPI Policy analyst Jeff Chapman.

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