Over the past 50 years, increases in women’s participation in the labor force and immigration have resulted in more women, Hispanics, and Asian Americans in the workforce. New data below from a forthcoming EPI report show that the working class is more diverse than ever before—no matter how you define it.

When defined by education, the working class is nearly half workers of color

The traditional definition of the working class comprises workers with less than a bachelor’s degree. Under this definition, in 1979, the working class was over 80% white. Today, workers of color collectively account for nearly half of the working class.

Working class by race and ethnicity

• 52% white
• 26.8% Hispanic
• 15.1% Black
• 4.7% AAPI
• 1.4% Native American

Working class by gender

• 56.4% men
• 43.6% women

When defined by income, the working class is similarly diverse

The working class could reasonably include more college graduates and traditional “white-collar workers” than were previously considered. That’s because the wage boost from getting a college degree is lower than it used to be, and underemployment—along with racial and gender pay disparities—can mean the economic status of graduates of color and women is more like some nongraduates.

By this broader measure, the working class can be considered the bottom 75% of U.S. households, regardless of education level or job type. This works out to a family income of below $150,000 per year.

Under this definition, the working class remains similarly diverse in terms of race and ethnicity. While men are still a majority of the working class, a larger share of women fit within this definition of working class, given lower pay in jobs predominantly held by college-educated women.

Working class by race and ethnicity

• 53.1% white
• 24% Hispanic
• 15.2% Black
• 6.5% AAPI
• 1.2% Native American

Working class by gender

• 52.5% men
• 47.5% women

However you define it, today’s working class is diverse by race, ethnicity, and gender. Improving economic conditions for today’s working class requires policies that meet the needs of all these workers.  

Source: Author’s analysis of pooled 2024–2025 Current Population Survey basic monthly microdata from EPI Microdata Extracts, Version 2026.8.13, https://microdata.epi.org.

Today, despite the ongoing economic and social toll of Trump’s draconian mass deportation policy, prime-age Latina workers continue to drive much of the strength in the employment rates of Hispanic workers. But we also see signs of weakness for younger workers between the ages of 16 and 24. New data released this year also show that Hispanic adults and their families share growing concerns about their employment security. We highlight each of these dynamics below.

Prime-age Latina workers are writing much of the employment story for Hispanic workers in 2026  

To trace the performance of Hispanic workers since last year, we examine 12-month moving averages of the employment-to-population ratio for prime-age Hispanic workers (ages 25–54) available in the EPI Data Library. There are a few reasons for this that are important to highlight. First, our 12-month moving average smooths much of the month-to-month noise due to sampling size limitations. We also focus exclusively on employment rates because it is not influenced by changes in labor force participation in the way that the unemployment rate is. Lastly, by focusing on prime-age workers—who are less likely to be out of the labor force due to schooling or retirement—our analysis is less influenced by changes in college attendance and the aging of the population.  

As seen in Figure A, the average employment rate for prime-age Hispanic workers stands at a historic high as of August 2026. These workers have managed to make inroads in employment despite a sluggish labor market experiencing weak-to-modest job growth.  

This story of resilience amid uncertainty continues to be largely attributed to prime-age Latina workers, who have managed to not just maintain their employment rate from 2025, but to build on last year’s gains. 70.7% of prime-age Latina workers had a job between September 2025 and August 2026—a new record high. While a significantly larger share of prime-age Latinos work relative to Latinas, their employment rate remains largely unchanged and below previous peaks.

Figure A

Prime-age Latinas are even outpacing their peers, who have historically enjoyed higher employment rates but have been more adversely impacted by the weaker labor market. Figure B shows that the average employment rate of prime-age Latinas continued to rise through August 2026, while that of their Black and white peers declined or flattened. This is because Latinas are more heavily concentrated in some of the economic sectors leading the charts in job growth, such as leisure and hospitality. Despite these gains, Latinas continue to be disproportionately affected by the gender pay gap due to the compounding effects of discrimination and occupational segregation. 

Figure B

Young Hispanic workers have not seen their employment situation improve over the last year 

Not all Hispanic workers have avoided a worsening employment situation in the last year. For example, the employment rates of young Hispanic workers between the ages of 16 and 24 have struggled to maintain consistent gains in the last year. While the average employment rate for young Latinos is now improving after a sharp drop last year, employment among young Latinas is falling along with that of other young workers and recent graduates.  

More broadly, this uneven progress may help us understand why more than half of Hispanic adults expressed concerns about finding or keeping a job last year. These growing employment fears remind us how difficult it is to achieve broad-based employment gains in a labor market struggling to regain its footing amid a mass deportation policy that will cost millions of jobs and an uncertain macroeconomic environment that continues to reproduce inequality. 

Key takeaways:

• The CROWN Act is legislation that protects students, workers, and housing applicants from race-based hair discrimination.
• 30 states have enacted some version of the CROWN Act, building momentum for a federal version to pass in Congress.
• Expansions of civil rights laws like the CROWN Act are more urgent than ever given Trump administration efforts to weaken nondiscrimination protections.

In an era of Trump administration attacks on nondiscrimination protections and diversity, equity, and inclusion (DEI) initiatives, workers and students need the guardrails included in the CROWN Act more than ever.

The CROWN Act stands for Creating a Respectful and Open World for Natural Hair. It expands existing civil rights law to prohibit race-based hair discrimination in schools, housing, and workplaces. Far from being solely focused on aesthetics, the CROWN Act protects against implicit bias and policing of Black and brown bodies. It codifies hair discrimination as racism and prohibits employers, public schools, and housing agencies from imposing whiteness as the uniform for success.

The CROWN Act is now law in 30 states

Pennsylvania and Rhode Island became the most recent states to pass the law in 2025, joining a growing list of states that have passed some form of the CROWN Act. Similar to the limited protections in Kentucky (which only provides public service and employee protections), Missouri also recently passed a limited version of the law that only applies to educational institutions—not workplaces or housing.

Figure A

Since the start of the second Trump administration, five states (Florida, Mississippi, Ohio, North Carolina, and South Carolina) have introduced at least one version of the CROWN Act.

Expanding CROWN Act legislation at the local level can be a significant incremental step toward expanding protections more broadly. In at least three of the states that introduced legislation, local CROWN laws have been adopted in cities including Charlotte, North Carolina, Columbus, Ohio, and Miami Beach, Florida. Such local policies have proven helpful in laying groundwork for passage of state laws elsewhere; for example, localities in Pennsylvania and Missouri passed CROWN Act laws years prior to these passing at the state level.

It’s time to pass the CROWN Act in Congress

Representative Watson Coleman (D-NJ) and Senator Cory Booker (D-NJ) introduced a federal version of the CROWN Act in the House and Senate last February. Neither bill has received a vote. With 60% of states already having passed the CROWN Act, the policy clearly has enough popular support to pass both chambers and become law.

A federal CROWN Act would provide consistent nationwide protection against hair discrimination for workers—especially Black women workers who have larger pay disparities and who are intersectionally impacted by a history of racist laws. Over 38.7% of Black women workers live in states where they are vulnerable to hair-based discrimination, based on the most recent 2024 data. That’s a slight improvement from the 44% of Black women workers who lacked protections in 2023, thanks to six more states—Kentucky, Missouri, New Hampshire, Pennsylvania, Rhode Island, and Vermont—recently passing some version of the CROWN Act.

Table 1

Although some states did not have large enough populations of Black women to be tracked in the data presented in Table 1, Black students and workers in states with smaller Black populations remain susceptible to discrimination. In South Dakota, for example, a student was told to cut their locks or leave school. Black students have shared similar stories in states across the country with varying Black population density.

Expansion of the CROWN Act must be coupled with strong enforcement

In an anti-DEI political climate, preventing hair-based discrimination must be coupled with addressing a growing crisis in federal and state nondiscrimination enforcement systems. Current threats to the Equal Employment Opportunity Commission’s (EEOC) enforcement mission are eroding protections for Black and brown workers. The EEOC was established by the Civil Rights Act of 1964 (the same law that the CROWN Act would expand) and was designed to be an independent federal agency to protect workers and promote fairness and equity in employment. The EEOC’s role in reducing discrimination has helped to boost average income by $493 to $1,233 per person since 1960. Historically, the EEOC has been a key source of protection for Black and brown people and women: A third of all EEOC charges were related to race (29,338) or sex (26,941) last year.

Figure B

Last year, the Trump-appointed chair of the EEOC hijacked the agency’s mission by actively soliciting complaints from white male workers and encouraging “DEI-related discrimination” claims of “reverse racism.” In addition to assigning a new chair, the Trump administration has weakened the EEOC by removing the ability to collect full pay data, limiting gender data collection, and removing commissioners—preventing a quorum and disrupting proceedings.

The Civil Rights Act itself and the protections that the EEOC was created to enforce are at risk. And some states are following the Trump administration’s lead by weakening state-level civil rights laws and enforcement systems. For example, in 2025, Iowa became the first state in history to strip nondiscrimination protection from a protected class when it removed gender identity from its state Civil Rights Act. In response, many cities and counties expanded their local civil rights ordinances to ensure protections against discrimination based on gender identity, but in 2026 the state went a step further and banned local governments from protecting any class not explicitly listed in state law. These recent legislative changes explicitly targeted trans people for discrimination, but will also have the broader effect of preempting local governments from adopting any expanded civil rights protections in the future, including local versions of the CROWN Act.

In the meantime, discrimination has not stopped and continues to have a measurable impact on Black, brown, and women workers—especially related to opportunities for securing a job and workplace advancement. New research finds that 59% of white adults hold anti-Black prejudice, contributing to a greater likelihood that Black applicants are rejected from jobs compared with their white counterparts. Women are paid 18.6% less than men. The disparity increases when considering race: Black women are paid 68.3% and Hispanic women are paid 64.5% of white men’s pay.

It is imperative to both expand protections like the CROWN Act at the local, state, and federal levels and strengthen state civil rights enforcement, while working toward eventual restoration of the EEOC’s capacity to carry out its mission to protect against discrimination in the workplace.

Figure A

These increases continue to be crucial for low-wage workers as they contend with the affordability crisis. The average increase in annual wages for a full-time, year-round worker resulting from these minimum-wage hikes ranges from $573 in Oregon to $811 in Alaska. These pay raises directly boost workers’ incomes, giving them a leg-up in the race against rising prices—a straightforward example of how policymakers can often more easily tackle affordability challenges through policy decisions that boost wages, such as setting strong wage floors.

A higher minimum wage has a positive impact on more than just the workers who currently earn the minimum wage; indirectly affected workers will see their pay go up too as employers adjust their wage ladders to the new wage floor. Our analysis of the increases in Alaska, Oregon, and Washington, D.C., accounts for these “spillover” effects and finds:

• Women make up more than half (56.3%) of affected workers.
• The wage increases disproportionately benefit Black and Hispanic workers. Black workers make up 15.3% of affected workers, despite making up 10.4% of the workforce across the three areas. Hispanic workers make up a similar percentage of the workforce (12.4%) but make up more than a fourth (26.0%) of affected workers.
• The vast majority (89.3%) of affected workers are age 20 or older, and more than 3 in 5 workers (62.1%) are 25 or older.
• More than half (52.9%) of the affected workers work full-time.
• The increases will raise wages for those who need it the most. Half (50.5%) of affected workers belong to households whose incomes are less than 200% of the poverty line.
• More than 1 in 5 (23.6%) of affected workers are parents.

Table 1

State and local policymakers should combat cost-of-living challenges with minimum wages

Because costs of living can vary significantly within a state, local policymakers should establish strong wage floors if the state minimum wage is inadequate for their area. In June, city councilors in Albuquerque, New Mexico, took an important step in that direction, passing a minimum-wage increase to $15 an hour by 2029. Whereas the current state minimum in New Mexico is $12 an hour, EPI’s Family Budget Calculator shows that a living wage for a single adult working full-time in Albuquerque is $17.56 an hour.1 The proactive step taken by local elected officials will provide significantly more economic security for low-wage workers in the city.

This summer, the minimum wage will increase in localities in California, Illinois, and Maryland (Table 2) due to “indexing”—automatic annual adjustments written into the minimum-wage law that require the wage floor be adjusted for price increases each year. Without indexing, the minimum wage is worth less and less every year as prices rise. With time, this can dramatically erode the value of the minimum wage. For example, the federal minimum wage of $7.25 an hour—which has not increased since 2009—has now lost 30% of its purchasing power.

Table 2

Indexing to inflation is a commonsense policy enacted in dozens of cities and states across the country, but it is not the strongest way to protect the value of the minimum wage. Adjusting for price increases mostly protects the real value of a low-wage worker’s paycheck (although low-wage workers are more vulnerable to inflation than top-of-the-line inflation measures indicate). However, in a well-functioning economy, wages for most workers—especially higher wage workers—will grow faster than inflation. If the minimum wage only rises at the rate of price growth, then over time, this can increase inequality between low-wage workers and everyone else.

One way to address this issue and ensure that low-wage workers do not fall further away from the middle class is to index the minimum wage to median wage growth. EPI’s latest vision for a federal minimum wage explicitly targets a wage floor that rises to two-thirds of the median wage and remains indexed there thereafter. This policy both creates a high floor that provides significantly higher wages for workers across the country and protects the minimum wage’s value against price increases and increases in wage inequality over time.

Oklahoma fails to pass minimum-wage ballot measure

In June, a minority of eligible Oklahoma voters rejected a ballot initiative (State Question 832) that would have increased the state’s minimum wage to $15 an hour by 2029. The initiative’s failure is a costly missed opportunity to increase wages for Oklahoma workers. More than 1 in 5 workers in the state earn less than $15 an hour, and if passed, the ballot initiative would have provided more than $783 million in increased earnings for low-wage workers.

During a time when cost of living and inflation are some of the most important concerns for voters, Oklahomans might have worried that increasing the minimum wage would have hurt affordability in the state. In fact, the opposite is true. Although raising the minimum wage can lead some affected businesses to increase prices, the resulting price increases are extremely modest—far smaller than the increase in pay that would go to low-wage workers. Even some of the most ambitious wage floor policies, such as California’s $20 fast food minimum wage, only increased fast-food prices 2.1% (around eight cents for a $4 item). A 10% increase in the minimum wage is associated with a 0.14 percentage point increase in CPI increase. In contrast, a 10% minimum-wage increase boosts income at the 10th percentile by around 3.6%, an order of magnitude greater. The average full-time, year-round Oklahoman worker affected by SQ 832 would have gained $2,322 in annual wages if voters had approved the initiative.

It is also important to highlight SQ 832’s winding path to the ballot. Ballot initiatives have historically been an important mechanism for passing minimum-wage increases in states with conservative-dominated legislatures like Florida, Missouri, and Nebraska. While Oklahoma is one of only three states in the South that has a ballot initiative process, conservative politicians have been increasingly curtailing it.

The Oklahoma minimum-wage ballot initiative is a prime example of this. Advocates originally began collecting signatures for SQ 832 in the lead-up to the November 2024 general election. Despite collecting nearly twice the necessary signatures in enough time to qualify for the ballot, advocates were thwarted when Governor Kevin Stitt delayed the State Question until the June 2026 gubernatorial primary election, a low turnout election in contrast to a general election with presidential candidates on the ballot. Voter turnout in the 2026 primary election was 26%, around half of what it was in the 2024 election.

In response to the emergence of SQ 832, the Oklahoma legislature also passed restrictions on the signature-gathering process, limiting the number of signatures that can be gathered from populous areas like Tulsa and Oklahoma City. These restrictions will make it more costly and logistically challenging to pass a future minimum-wage increase in Oklahoma. With such low voter turnout and marked interference in the ballot initiative process, it is difficult to say that SQ 832’s failure reflects a lack of popular support for minimum-wage increases in Oklahoma. Regardless of the cause, without a future minimum-wage increase, the issue of low pay in Oklahoma is only going to grow.

When policymakers like those in Oklahoma fail to adequately set the wage floor, it suppresses worker pay, not just for the lowest-paid workers, but for low-wage workers in general. Workers need a raise to help them overcome the affordability crisis, and the minimum wage is an evidence-backed tool under policymakers’ control to help them do that.

1. Assuming 81% of income comes from wages.

Key takeaways:

• The persistent gender wage gap widened slightly in 2025; women were paid 18.6% less than men on average after controlling for race and ethnicity, education, age, marital status, and state.
• Women are paid less than men across all education levels. Women with a graduate degree earn less, on average, than men with only a college degree.

• The gender pay gap worsened following a year of Trump administration attacks on workers, including cuts to the federal workforce; attacks on diversity, equity, and inclusion efforts; ordering mass deportations; and undermining child care and home care providers.
• States can narrow the gender pay gap with policies that guarantee access to paid family and medical leave, mandate pay transparency, raise the minimum wage, and make it easier for workers to form unions.

March 26 is Equal Pay Day, a reminder that there is still a significant pay gap between men and women in our country. The date represents how far into 2026 women would have to work on top of the hours they worked in 2025 simply to match what men were paid in 2025.

On an hourly basis, women were paid 18.6% less on average than men in 2025, after controlling for race and ethnicity, education, age, marital status, and state. After narrowing to a series low of 18.0% in 2024—likely driven by a strong labor market recovery from the COVID-19 recession that lifted wages more at the lower end of the overall wage distribution—the gender wage gap widened slightly in 2025. Though far from a total reversal of the last few years’ progress, the slight worsening in 2025 reflects the slowing of low-end wage growth and the economic consequences of Trump’s first year back in office.

Women are paid less than men due to discrimination associated with occupational segregation, devaluation of women’s work, and societal norms, much of which takes root well before women enter the labor market. The wage gap is smallest among lower-wage workers partly because the minimum wage creates a wage floor. At the 10th percentile, women are paid $1.39 (or 9.1%) less an hour than men, while the wage gap at the middle is $4.12 an hour (or 14.7%). Women at the 90th percentile of their wage distribution are paid $14.05 (or 19.6%) less an hour than men at the 90th percentile of the wage distribution.

Women are paid less than men at every education level

Although women have seen gains in educational attainment over the last five decades, they still face a significant wage gap. Among workers, women slightly outnumber men in the college-educated labor force and are significantly more likely to obtain a graduate degree than men. Even so, women are paid less than men at every education level, as shown in Figure A.

Figure A

Among workers who have only a high school diploma, women are paid 21.5% less than men. Among workers who have a college degree, women are paid 23.8% less than men. That gap of $12.07 per hour translates to roughly $25,100 lower annual earnings for a full-time worker. Women with an advanced degree also experience a significant hourly wage gap of $17.70 in 2025, amounting to over $36,800 annually.

What the data makes very clear is that women cannot educate themselves out of the gender wage gap. Systemic inequities are so persistent that women with advanced degrees are paid less per hour, on average, than men with only college degrees. Men with a college degree only are paid $50.61 per hour on average compared with $49.67 for women with an advanced degree.

Black and Hispanic women experience the largest wage gaps

For Black and Hispanic women, the pay gaps relative to white men are even larger due to compounded discrimination and occupational segregation based on both gender and race/ethnicity. In Figure B, we compare middle wages—or the 50th percentile of each group’s wage distribution—for Asian American/Pacific Islander (AAPI), Black, Hispanic, and white women with that of white men.1

White and AAPI women are paid 81.9% and 93.3%, respectively, of the amount non-Hispanic white men are paid. Black women are paid only 68.3% of white men’s wages at the middle, down from 69.6% in 2024. This is a gap of $9.87 on an hourly basis, which translates to roughly $20,500 lower annual earnings for a full-time worker. For Hispanic women, the gap is even larger: Hispanic women are paid only 64.5% of white men’s wages, an hourly wage gap of $11.06. For a full-time worker, that gap is over $23,000 a year. This disparity has also risen slightly compared with last year.

Figure B

Even when controlling for age, education, marital status, and state of residence, Black and Hispanic women are paid 25.3% and 27.4% less than their white male counterparts, respectively. In other words, very little of the observed difference in pay is explained by differences in education, experience, or regional economic conditions.

Trump administration policies exacerbate lower pay and make it harder to enforce antidiscrimination laws

Over the last year, the Trump administration has repeatedly taken actions that harm women workers, including:

• slashing the federal workforce;
• weaponizing agencies meant to defend workers and combat discrimination by turning them into defenders of discriminatory practices;
• eliminating enforcement of race- and gender-based equal employment practices for federal contractors;
• ordering mass deportations;
• undermining child care providers and vital state funds;
• limiting access to funding for higher education;
• rolling back protections for home care workers; and
• normalizing harassment and retaliation in the workplace.

Black and Hispanic women have endured and will continue to suffer the consequences of these attacks more intensely than many of their white, non-Hispanic male colleagues. Trump’s reckless decimation of the federal workforce, for instance, has disproportionately affected Black women, for whom government jobs have historically been a powerful tool for economic mobility and security. In 2025, Black women’s employment rate fell by 1.4 percentage points to 55.7%. This is one of the sharpest one-year declines in the last 25 years and is a much more dramatic drop than that of other women or Black men. College-educated Black women experienced the largest drop in employment, likely because nearly half of Black federal government workers have a bachelor’s degree or higher. This drop in well-paid, traditionally stable jobs will almost certainly lead to increased economic insecurity. Additionally, mass deportations will likely reduce jobs for both immigrant and U.S.-born women, particularly in the care sector, disproportionately impacting Hispanic women.

The Trump administration has also stifled the government’s ability to protect workers and penalize discriminatory employers. The restriction of the use of words like “gender,” “race,” “equity,” and “discrimination,” and attempts to weaponize the Equal Employment Opportunity Commission (EEOC) against women and workers of color will harm all workers, while weakening our ability to track pay equity and enforce nondiscrimination laws. Staffing levels at the EEOC have fallen steadily over the last four decades, but recent funding cuts and shifting priorities will exacerbate its already reduced capacity for enforcement. There have also been ongoing threats to the availability and continued collection of key data throughout federal agencies. If agencies that collect data on wages and incomes by demographic characteristics pull back, it would be a disaster for anyone—policymakers, researchers, employers, or workers—who wants basic facts about how well the economy is performing for different workers and different sectors.

Despite federal threats, states can help close the gender pay gap

Closing pay gaps by gender and by race and ethnicity will require policy solutions on multiple fronts. Although attacks on gender and racial equity continue at the federal level, state lawmakers can and must take steps to address the gender wage gap. Potential solutions include enacting pay transparency laws, mandating Paid Family and Medical Leave (PFML), raising the minimum wage, funding universal child care, and removing anti-worker, so-called “right-to-work” (RTW) statutes. Figure C highlights the states that have already passed some of these critical pieces of legislation, while underscoring the need for strong federal standards to cover the millions of workers who live outside of these states.

Figure C

Only 14 states have mandatory, comprehensive PFML policies, even though they provide essential benefits that help workers maintain their livelihoods while taking care of themselves and their families. Studies show that access to PFML improves outcomes for parents and children, workforce participation, and job retention, and that this a beneficial policy for both employees and employers. Access to paid leave is also shown to bridge racial gaps in care and pay.

Pay transparency laws are another useful tool that prevents employers from offering unequal pay by requiring them to include wage information in job postings. While there is some variation in laws, all include some requirement that employers provide salary information in job postings, but employers in Connecticut, Maryland, and Rhode Island only must furnish that information if requested by applicants. This wage transparency has the potential to reduce gender-based discrimination by arming jobseekers with more information and limiting employers’ ability to pay different amounts to similarly qualified candidates. A Colorado pay transparency law, for example, reduced gender wage gaps for workers who changed jobs by as much as 8.9%.

Policymakers effectively stopped protecting workers’ rights to form unions and bargain collectively starting in the 1980s, resulting in less leverage for workers and increased income inequality. Weak labor law allows employers to retaliate against union organizing and undermine workers’ right to collectively bargain. Union contracts can help narrow gender and racial wage gaps by providing clear wages for a given level of experience and education, reducing employers’ ability to discriminate in wage setting. Unfortunately, 26 states have RTW laws that make it even harder for unions to effectively organize and bargain for better contracts. States with these laws not only have lower unionization rates but also have wider gender wage gaps. By making it easier for workers to form unions, policymakers can help reduce these pay gaps.

The minimum wage keeps wages from falling below a mandated floor. While the real value of the federal minimum wage has been allowed to decline, down nearly $5 an hour since its peak in 1968, states have stepped in and increased their minimum wage. As of January 2026, 30 states and D.C. have minimum wages higher than the federal minimum, covering more than half of U.S. workers. Since women are disproportionately found in the low-wage workforce, these laws are key to increasing their economic security and narrowing wage gaps at the lower end of the wage distribution.

Although there is no single policy that will close the wage gap, each of these solutions will narrow it and improve conditions for workers across the country. In his first year back in office, Trump has rolled back critical labor standards, decimated federal unions, and laid off tens of thousands of federal workers. Now, more than ever, it is critical that states step up to protect workers under attack, prevent the gender wage gap from expanding, and build an equitable economy that works for all. 

1. Race/ethnicity categories are mutually exclusive in this analysis. Here we denote white to mean white non-Hispanic, Black is Black non-Hispanic, Asian American/Pacific Islander (AAPI) are AAPI non-Hispanic, and Hispanic refers to Hispanic of any race.

Key takeaways:

• Trump has weaponized the EEOC to go after employers with diversity, equity, and inclusion (DEI) programs, accusing them of “reverse racism” against white workers—but nothing in the EEOC’s own data points to evidence of systemic discrimination against white workers.
• People of color have made up a growing share of the U.S. working-age population since 1989, while the share of the white working-age population has fallen from 76.9% in 1989 to 55.4% in 2025.
• According to data submitted to the EEOC by large employers, workers of color make up more than 40% of the workforce but hold only 1 in 5 executive or senior-level positions—a pattern that contradicts the administration’s narrative of bias against white workers.

Trump’s Equal Employment Opportunity Commission (EEOC) recently opened a federal investigation into Nike and its diversity, equity, and inclusion (DEI) initiatives—alleging systemic discrimination against white workers. This is the first time the EEOC has targeted a large private employer with a federal investigation and subpoena explicitly linked to their DEI initiatives and hiring goals. Shortly thereafter, the EEOC sued a Coca-Cola bottling company for sex discrimination following a networking event it held for female employees. The EEOC chair closed a busy February with a letter to Fortune 500 companies, warning them about “unlawful discrimination” related to their use of DEI initiatives.

These recent EEOC actions reflect Trump’s undue control over the agency and his administration’s effective weaponization of the EEOC to fight against DEI, a broad set of programs and initiatives designed to remedy the long and well-documented history of systemic injustices against people of color and women in the labor market. Established by the Civil Rights Act of 1964, the EEOC has operated as an independent federal agency throughout its 60-year history enforcing employment nondiscrimination laws—until last year.

EEOC Chair Andrea Lucas has repeatedly affirmed her commitment to redirecting the EEOC’s priorities toward those of the administration; she has made the scrutiny of DEI programs and initiatives a top enforcement priority. This restructuring of EEOC priorities follows the administration’s revisionist version of history that centers white men—not people of color and women—as the primary victims of labor market discrimination. In an unprecedented move last December, Chair Lucas actively solicited discrimination complaints from white male workers, arguing that DEI initiatives function as illegal quotas that make it easier for employers to discriminate against white men. Previous EEOC chairs have avoided using their platform to solicit charges from specific demographic groups. In January 2026, the Republican majority voted to give the chair more power to decide which matters reach the full commission and to require nearly all litigation to be approved by the commissioners. The vote to centralize power with the chair and Republican majority completely neutralizes bipartisan decision-making over which cases to pursue.

Right-wing commentators have cited a now debunked report that over 90% of new corporate hires were people of color as evidence of DEI gone too far. In this post, we expose the fallacy of such claims by showing increased employment among people of color is consistent with demographic changes in the working-age population. The Trump EEOC’s targeting of employers with programs aimed at improving hiring and promotion of historically underrepresented groups defies the ongoing demographic changes of the U.S. labor force and the spirit of the Civil Rights Act that created the agency. Under current law, anyone who believes they’ve experienced discrimination based on race, sex, color, religion, national origin, age, and disability can file a charge. By prioritizing so-called “reverse discrimination,” fewer of the underfunded agency’s resources will be available to investigate systemic inequities against workers of color or members of any other protected class.

DEI programs or not, the U.S. working population is increasingly more diverse and less white

 As Trump’s EEOC goes after private employers based on their efforts to improve workplace diversity, equity, and inclusion, it is important to understand that non-Hispanic white workers are a smaller share of the U.S. workforce than they were decades ago. In 1989, for example, more than 3 out of 4 people between the ages of 16 and 64 were white (see Figure A). This share declined by 28% over the course of the last three decades. In 2025, just over half (55.4%) of the U.S. working-age population was white. People of color, on the other hand, have become an increasing share of the working-age population since 1989.

Figure A

Last year, more than 2 in 5 individuals between the ages of 16 and 64 were either Hispanic, Black, or Asian American and Pacific Islander (AAPI). This figure nearly doubled between 1989 and 2025. A significant share of this growth can be attributed to the growth of the Hispanic working-age population, which nearly tripled over the course of the last three decades with increased immigration.

Figure B

This demographic shift is most evident among younger workers—the new hires who will gradually replace less diverse cohorts of older workers as they retire. Nearly 1 in 2 individuals between the ages of 16 to 24 are either Black, Hispanic, AAPI, or American Indian and Alaska Native (see Figure B), up more than 80% since 1989. Based on these numbers, it is only logical that historically underrepresented groups of workers account for a larger share of employment now and in the future than they did decades ago—regardless of DEI initiatives. In fact, workplaces that reflect the growing diversity of the labor force are a sign of less discrimination, not of a bias against white workers. Moreover, employers who set and pursue DEI goals that develop the talent and career growth of workers of color are making forward-looking investments in the leadership of the future workforce. This has been a primary motivation and justification for many DEI initiatives.

Despite the growing diversification of the U.S. workforce, EEOC data suggest that people of color continue to be underrepresented in leadership positions

While Trump’s EEOC targets and accuses employers with equity initiatives of bias against white workers, demographic statistics reported to the regulatory agency paint a different picture when it comes to representation in leadership roles. Private employers with 100 or more employees and federal contractors with 50 or more employees are required to file an annual EEO-1 report. These data are used to support EEOC enforcement efforts and can raise flags about systemic patterns of discrimination. Based on publicly available EEO-1 data for 2023 (latest year), white workers are significantly more likely to be overrepresented in leadership positions (see Figure C). In 2023, for example, Black, Hispanic, AAPI, and AIAN workers accounted for more than 40% of workers in all job categories at EEO-1 reporting firms, but only about 1 in 5 employees in executive- or senior-level positions. Similarly, less than 1 in 3 workers in mid-level, managerial positions identified as Black, Hispanic, AAPI, or AIAN in 2023.

Figure C

Table 1 presents the 2023 data along with data for 2020—the year several private employers launched DEI initiatives in response to the racial reckoning that followed the murder of George Floyd at the hands of police officers—and 2017. While it is impossible to disentangle DEI from demographic and pandemic effects based on these data alone, we can see changes in the racial composition of employees at EEO-1 reporting firms over these years that are generally consistent with changes in the working-age population shown in Figure A. More importantly, nothing in these statistics points to evidence of systemic “DEI-motivated discrimination” against white workers. Relative to the preceding three years, between 2020 and 2023, there was a larger increase in the share of all people of color employed in executive-/senior- level and first-/mid-level management positions—3.7 and 3.3 percentage points, respectively—but white workers remained significantly overrepresented in these roles. Throughout the entire period, Black and Hispanic workers remained grossly underrepresented relative to their share of all positions.

Table 1

The Trump EEOC’s intentional diversion of attention and resources away from more prevalent forms of discrimination will hurt all workers

Aggregate results alone neither qualify nor disqualify a charge of discrimination against a specific employer. All charges, whether filed by an individual or an EEOC commissioner, are individually investigated— a process involving extensive information gathering and detailed examination of the facts to assess the merits of the charge. The administration’s aggressive search for evidence of “reverse discrimination” diverts the limited resources of an already understaffed and underfunded agency away from investigating more prevalent forms of racial and gender discrimination that are consistent with persistent racial and gender wage gaps and patterns of occupational segregation.

It would be a mistake to assume that Trump and the Republican majority leading the EEOC don’t understand the nature of demographic changes in the U.S. population and labor market. The administration’s campaign against DEI initiatives and accusations of bias against white male workers represent an emboldened assertion of white supremacy to stoke fear and to recast growing racial, ethnic, and gender diversity as a threat to social and economic advantages historically afforded to white men. This is a strategy that has often led to periods of slower economic growth and greater economic inequality. In the end, it not only makes the American workplace less fair, but it also risks lowering the standard of living for all working people and their families. 

In 2025, Black women’s employment rate fell by 1.4 percentage points to 55.7%. This is one of the sharpest one-year declines in the last 25 years (see Figure A). The decline among Black men and white women was no more than 0.5 percentage points each while employment rose slightly for Hispanic (+0.6 percentage points) and AAPI (+0.4 percentage points) women. At 55.7%, Black women’s employment-to-population ratio (EPOP) was well below the most recent peak of 57.8% in 2023, reflecting employment losses that started in 2024 and accelerated in 2025. These estimates are also available in EPI’s State of Working America Data Library.

Figure A

The decline in Black women’s employment over the last year included exits from the labor force and rising unemployment among remaining jobseekers. Their labor force participation rate dropped from 60.6% in 2024 to 59.7% in 2025 as the unemployment rate rose from 5.8% to 6.7%.

A closer look reveals that college-educated Black women experienced the greatest drop in employment and labor force participation rates. As shown in Figure B, the EPOP for Black women with bachelor’s degrees fell by 3.5 percentage points over the last year—a much larger decline than any other education category, including those who are not college graduates. Similarly, the labor force participation rate declined most for Black women bachelor’s degree holders—down 2.3 percentage points in 2025.

Figure B

Large employment losses and labor force departures among college graduates were a direct consequence of the Trump administration implementing massive federal layoffs and buyouts over the last year, a sector where nearly half of Black workers have a bachelor’s degree or higher. Analysis of Current Population Survey (CPS) microdata further supports this as a driving factor. Figure C presents changes in the number of Black women employed by self-reported sector and industry of employment between 2024 and 2025. Notably, it shows that the overall net loss in employed Black women was driven entirely by public-sector losses, with most job losses in federal government.

While Black women saw a net increase in private-sector employment in 2025—primarily in the growing education and health services industry—there were net losses in six of the 12 major private-sector industries. Among the net losses, 33% occurred in other services, followed by 25% in manufacturing, 21% in financial activities, and 15% in professional and business services. The other services industry includes establishments primarily engaged in repair and maintenance and personal and laundry services, as well as work for private households and religious, grantmaking, civic, and professional organizations.

To put a finer point on the dominant influence of Black women’s employment losses on rising Black unemployment in 2025, Figure C also shows that Black men reported a net gain in the total number employed. Black men had a much smaller decline in federal government employment and relatively fewer industry-specific private-sector losses.

Figure C

While this analysis offers more details about the decline in Black women’s employment, the biggest looming question remains unanswered: Why do federal and private-sector employment losses seem so targeted to Black women? Whether those losses are an early indication of more widespread job losses to come—or casualties of anti-equity backlash in action—could become clearer in the months ahead.

Key takeaways

• Proposed state legislation to extend full, equal collective bargaining rights to all state and local government workers can help Virginia:
  • reduce the state’s large public-sector pay gap
  • improve public services
  • reduce staff vacancies and turnover
  • decrease racial and gender wage disparities
• Strong collective bargaining rights and increased unionization rates are highly correlated with numerous, widely shared benefits including higher wages, more equitable state economies, and healthier democracies.
• Virginia currently has one of the largest public-sector pay gaps in the nation. State and local government employees in Virginia earn, on average, 26.7% less than private-sector peers with similar education and experience.
• The public-sector pay gap varies across states and is largest in states like Virginia where most public employees lack collective bargaining rights. In Virginia, collective bargaining is currently banned for state employees and only recently became permitted for some local government employees.

In 2026, Virginia lawmakers are poised to consider transformative legislation that would extend full collective bargaining rights to public employees at all levels of state and local government. The benefits of comprehensive collective bargaining rights would extend far beyond affected public employees who would enjoy better working conditions. Stronger state collective bargaining laws can help improve the quality of public services and economic outcomes for all Virginians.

Data show that strong collective bargaining laws help states address persistent public-sector pay gaps, reduce staff vacancies and turnover, and lead to higher unionization rates (Morrissey and Sherer 2024). Increased unionization rates are highly correlated with numerous, widely shared benefits including more equitable state economies and healthier democracies (McNicholas et al. 2025).

For Virginia, expanding public-sector bargaining is a critical next step in building an economy that works for all. The expansion will reverse a long history of anti-worker state policies that have suppressed wages and limited workers’ power in the labor market by blocking pathways to unionization. Such policies have resulted in greater income inequality and persistent racial and gender wage disparities (Bivens and Shierholz 2018; Mishel and Bivens 2021). Strong, comprehensive state legislation covering public employees’ labor rights is also especially important at a moment when the federal government has been attacking the jobs, working conditions, and union contracts of over 235,000 federal civil servants residing in Virginia, and threatening long-standing federal protections of all workers’ rights (EPI 2025b; Oakford and Poydock 2025). 

This report examines how public-sector workers with limited or no collective bargaining rights fare compared with public-sector workers with well-established collective bargaining rights. To do so, we estimate pay differences between state and local government workers and private-sector workers with similar education and experience. In this analysis, Virginia is among a minority of states in which state employees have no bargaining rights and only some local government employees have limited bargaining rights. By contrast, 27 states have well-established collective bargaining rights for state and local government workers (Table 1).

The right to bargain collectively over pay is associated with higher unionization rates (union membership as a share of the workforce) in a given state. This report shows that collective bargaining rights and union strength help state and local government workers narrow the pay gap with private-sector workers. We show that the pay gap for public employees is significantly larger when these workers have weak or no bargaining rights, like public employees in Virginia, which has one of the largest public-sector pay gaps in the nation (-26.7%).

Virginia public employees lack collective bargaining rights

Proposed legislation in Virginia would, for the first time in the state’s history, guarantee that all state and local government employees enjoy labor rights similar to those of their private-sector peers (whose rights to collectively bargain are covered under the federal National Labor Relations Act) (HB 1263 and SB 378). The Virginia Assembly passed similar legislation (HB 2764 and SB 917) in 2025, only to have it vetoed by then-Governor Glenn Youngkin (McGinley 2025). 

Virginia is one of a handful of Southern states that for decades explicitly banned public employees and employers from entering into collective bargaining agreements. In 2020, Virginia took an important step toward making collective bargaining newly optional for local governments, but the state’s policies remain out of step compared with most states. Virginia lacks a statewide collective bargaining statute covering all local government employees and still has a ban in place barring state employees from collective bargaining (Borja 2022).

As shown in Table 1, the majority of states and Washington, D.C., already ensure collective bargaining rights for most public employees, including state workers. Many states have had statewide public-sector bargaining statutes in place for decades (Rueben 1996; Sanes and Schmitt 2014). Such laws typically set clear, uniform guidelines for union elections and contract negotiation processes and establish state labor boards charged with fostering productive labor-management relations (including timely contract settlements), ensuring broad awareness of and compliance with statutory guidelines, and mediating or adjudicating disputes as needed.

Table 1

Who are public employees in Virginia?

In 2024, approximately 560,000 Virginians worked in state and local government occupations (BLS-CES 2020–2025). This includes teachers and school staff, firefighters, transit operators, law enforcement, administrative staff, and employees serving the state’s public safety, transportation, health care, judicial, corrections, and higher education systems. As shown in Table 2, 21.2% of Virginia state government employees and 20.4% of Virginia local government employees are Black, and 57.3% of state government employees and 64.5% of local government employees are women. Many public-sector workers in the state are highly educated. Virginia public-sector workers are more than twice as likely to have advanced degrees as private-sector workers and are much less likely to have a high-school level or less education.

Table 2

Anti-union state policies are rooted in racism and harm all Virginia workers

Virginia’s ban on union contracts for public employees is a Jim Crow-era policy with deep roots in the history of slavery and white supremacy. After the passage of federal labor laws accelerated worker organizing in the 1930s, Virginia joined several Southern states in adopting anti-union state laws designed to prevent multiracial union organizing and suppress Black workers’ wages and power (Childers 2023). The Virginia Assembly first took an explicit stance on public-sector bargaining in response to the unionization of Black hospital employees at the University of Virginia in 1946, via a joint resolution declaring it against the public policy of the state to negotiate with public employee unions (a stance later affirmed by state supreme court decisions and codified in statute in 1993). Virginia was also among the first states to adopt anti-union so-called right-to-work legislation in 1947, an anti-labor policy jointly promoted by white supremacist organizations and industry groups intent on slowing the growth of unions to maintain access to cheap labor—especially in Southern states (The Commonwealth Institute 2022; Watts 2021; Pierce 2017, 2018; Sherer and Gould 2024).

As a result of these long-standing anti-union state policies, unionization rates in Virginia for both public- and private-sector workers are well below national averages.

Figure A

Narrowing Virginia’s large public-sector pay gap

Across the country, public-sector employees earn less than their private-sector counterparts, and this pay gap has widened in recent years. In the latest available five-year period (September 2020–August 2025), state and local government employees earned, on average, 17.2% less than private-sector employees with similar education and experience. The size of the public-sector pay gap varies across states and is largest in states like Virginia where most public employees lack collective bargaining rights. Public-sector workers with strong bargaining rights experience a narrower pay gap (-14.3%) than those with weak (-19.6%) or no bargaining rights (-22.5%) (see Table 3).

Virginia currently has one of the largest public-sector pay gaps in the nation. Among all 50 states, Virginia’s -26.7% public-sector pay gap appears to be the second highest, though differences among states clustered at the bottom of the rankings are not statistically significant. (Pay gap statistics are for full-time wage and salary workers ages 18–64, based on the authors’ analysis of pooled September 2020–August 2025 Current Population Survey microdata downloaded from Flood et al. 2025 and EPI 2025a.)

Compensation packages of public employees, on average, include more robust benefits than those of private-sector workers, but Virginia’s public-sector compensation gap remains large, even when factoring in more robust benefits. Benefits are an estimated 32.0% of pay for private-sector workers in the South Atlantic region and an estimated 51.3% of pay for Virginia public-sector workers. Factoring in benefits, Virginia’s public-sector compensation gap shrinks to a still sizable 16.0% (authors’ estimate based on BLS-ECEC 2020–2025 and Public Plans Data 2020–2024; see Morrissey and Sherer 2024 for methodology).1

Table 3

Addressing high staff vacancy and turnover rates in Virginia’s public sector

The growing public-sector pay gap has become a particular concern at a moment when low pay has created serious challenges to recruiting and retaining teachers and other public employees across the country (Cooper and Martinez Hickey 2022; MissionSquare Research Institute 2023; Wething 2024a, 2024b; Martinez Hickey 2025). Virginia has faced particularly acute staffing shortages in public education and in units of state government in recent years (Manzanares 2025; Cantor 2025).

The latest (2025) biennial compensation report from the state’s Department of Human Resource Management notes that “Years without any salary adjustments in the past have made it difficult for state agencies to build a proactive and sustainable approach to addressing compensation, recruitment and retention concerns” (VDHRM 2025). Between 2001 and 2023, low average salary increases for state workers (just 2.9% per year, compared with 3.4% annually in the private sector) have led to high vacancy and turnover rates. As of 2024, roughly 1 in 5 (22.4%) state jobs were unfilled, and the median salary across the state workforce was just $61,305—a full $5,000 less than the median city employee salary in Richmond, which has adopted its own collective bargaining ordinance (McGinley 2025).

Chronic state employee staffing shortages are already having direct impacts on the health, safety, and quality of life of Virginians. To take one example, in 2025 the Virginia Department of Juvenile Justice (DJJ) drew headlines after reporting that inability to adequately staff large facilities for incarcerated youth had led to unsafe conditions, lockdowns, increased restrictions on out-of-cell time, and a lack of rehabilitative services. DJJ directors indicated ongoing difficulty recruiting for open positions, despite participating in job fairs, college and university visits, outreach to military and veteran communities, and offering signing bonuses and referral incentives (Manzanares 2025). The root causes of understaffing identified by Virginia state agencies like DJJ—from burnout and high workloads to low starting salaries, lackluster raises, and difficult or unsafe working conditions—are precisely the topics that a structured collective bargaining process would allow state agencies to address, with direct input from frontline employees.

Addressing racial and gender pay gaps to improve recruitment and retention of workers of color and women

The public-sector pay gap disproportionately affects Black workers and women, who are more likely to be employed in public-sector jobs and who are disadvantaged in the broader labor market (Childers 2025). Strengthening collective bargaining rights for government workers in Virginia therefore promises to narrow the pay gap and reduce racial and gender inequalities in public institutions and across the labor market.

For example, a 2024 RAND report showed that Black teachers nationally receive lower average salaries and pay raises than white teachers do, a difference linked directly to the fact that Black teachers were less likely to live in states where public educators had collective bargaining rights. The inadequacy of pay is one of the main reasons teachers report for leaving the profession, further contributing to the demographic mismatch between teachers and students (e.g., nationwide over half of all students are children of color, but the teaching workforce remains around 80% white) (Steiner et al. 2024; Gopalan 2025). Likewise, data show that in states like Wisconsin where legislators have weakened formerly strong collective bargaining rights in the past two decades, resulting decreases in unionization levels and worker wages have measurably widened public-sector pay gaps and gender pay gaps (Nack et al. 2019; García and Han 2021; Biasi and Sarsons 2022).

Building on success and remedying limitations of current state law that only permits local collective bargaining

In 2020, Virginia partially lifted its long-standing ban on public-sector collective bargaining with legislation creating an “opt-in” system that has allowed local governments to set their own policies on whether and how to bargain with their own employees. While this opening fell far short of creating a consistent statewide framework for collective bargaining, it has resulted in at least 17 of Virginia’s largest cities, counties, and school boards adopting collective bargaining ordinances and creating new pathways to union contracts for substantial numbers of public employees—including, for example, 27,000 teachers and school staff and 12,000 county employees in Fairfax County; nearly 4,000 City of Richmond employees; and others (Borja 2022; Sharma 2022; Khalil 2023; Lukert 2024; Pope 2025; Walter 2026).

The local “opt-in” system was a positive step forward that has already revealed high levels of interest in collective bargaining among Virginia workers. The system resulted in new union contracts covering tens of thousands of frontline educators and civil servants, providing an initial boost to Virginia’s historically low unionization rate.

Significant limitations of the new “opt-in” system have also quickly become clear. As noted above, the major shortcoming of the current law is that it does not ensure equal collective bargaining rights for all public employees. Virginia state employees remain barred from collective bargaining, and in local government where collective bargaining is permitted (but not required), workers continue to lack collective bargaining rights, unless they are able to persuade local officials to adopt and then implement a collective bargaining ordinance. When localities do adopt such ordinances, they may vary in strength and effectiveness (Overman 2023).

As a result, Virginia’s current “opt-in” system for local collective bargaining has generated an uneven patchwork of highly variable (and potentially unstable) collective bargaining policies across the state. Some local governments have continued to block workers’ path to a union contract by rejecting appeals from their own employees to adopt local collective bargaining ordinances (Murphy 2024; Cooper 2025; Lytle 2025; Wilkinson 2025). Because current state law leaves the burden of collective bargaining policy development up to each individual local government, some jurisdictions have expressed interest in or support for collective bargaining while remaining reluctant to invest the necessary time or scarce administrative or legal resources to developing and implementing a local ordinance. Even in larger local jurisdictions with strong collective bargaining ordinances now in place, the “opt-in” system remains fragile and highly vulnerable to instability whenever turnover occurs among elected leaders or administrators with experience necessary to maintain unique local labor-management systems.

Creating a state labor board to provide efficiency and stability for all Virginia public employers and employees

A proposed state labor board equipped to administer a statewide, uniform collective bargaining framework would serve all Virginia state and local government entities and provide consistency, efficiency, stability, and economies of scale. All Virginia public employers and employees would benefit from access to a central, independent state board with capacities to advise public employers and employees about collective bargaining procedures, administer union elections, and mediate contract negotiations. The creation of such state capacities is also especially important at moment when federal labor agencies with similar capacities have been eliminated or rendered non-functional. Indeed, across the country, many states are relying more than ever on their existing state labor boards, and in some cases, are exploring paths to expanding state labor board capacities in order to ensure consistent protections of workers’ rights to unionize and collectively bargain (H.B. 3005; Walter and Madland 2025).

Conclusion

In 2026, Virginia lawmakers should seize the opportunity to enact strong, comprehensive collective bargaining legislation that covers all state and local government workers and creates a state labor board to administer the new system. Under Virginia’s current state law (where collective bargaining is banned for state employees and allowed only for some local government workers), pay for Virginia public employees has lagged far behind that of private sector counterparts with similar education and experience.

Stronger collective bargaining rights can help shrink Virginia’s large public-sector pay gap, reduce racial and gender pay gaps, and improve recruitment and retention of qualified public employees. Removing barriers to unionization for public employees is also a critical step toward reversing the impacts of long-standing anti-worker state policies in Virginia that have for decades suppressed all workers’ wages and contributed to growing income inequality. Lastly, state action to shore up public employee rights is especially important at moment when the federal government is attacking civil servants, public education, health care, and all public services. By extending full collective bargaining rights to historically excluded state and local government workers, state lawmakers can help lead the way to a more vibrant, equitable economy rooted in multiracial democracy in Virginia, the South, and the nation.

Notes

1. If anything, our comparison likely minimizes the public-sector compensation gap in Virginia by comparing benefits for private-sector workers in the South Atlantic region to public-sector workers throughout the country because public-sector data for the South Atlantic region is not available from the Bureau of Labor Statistics. Our comparison does account for the fact that Virginia pension benefits are less generous than public pensions in many parts of the country, though possibly not in two Northern Virginia counties with their own retirement systems. It does not fully account for other differences in benefits between Virginia public-sector workers and their counterparts in other states, though it does account for the fact that public-sector workers in Virginia are covered by Social Security (not true in some states) and adds 1% for public-sector retiree health benefits that are not included in BLS compensation statistics. Finally, it compares all public-sector workers with all private-sector workers, when arguably the better comparison would be between public-sector workers and private-sector workers employed by large employers, who tend to provide more generous benefits than small employers.

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Three key takeaways:

• More than 8.3 million workers will get a raise starting January 1 as 19 states raise their minimum wages.
• For the first time, there will be more workers in states with a $15 or greater minimum wage than in states with the federal minimum of $7.25.
• Minimum wage increases are critical for improving affordability. State and federal policymakers should ensure wage floors meet the needs of all workers.

Nineteen states will increase their minimum wages on January 1, boosting earnings for more than 8.3 million workers by a total of $5 billion. In addition, 47 cities and counties will raise their minimum wages, adding to the number of workers likely to get larger paychecks because of lawmakers—or in some cases, voters—taking action to lift state and local wage floors.

Figure A

State minimum wage increases this January will boost wages for a broad range of working people and help shape a more equitable economy. Our estimates account for all affected workers: Both those directly receiving an increased minimum wage and those indirectly affected as employers adjust their wage ladders to the new wage floor. According to our analysis:

• Women make up the majority (58.1%) of affected workers.
• Black and Hispanic workers will disproportionately benefit. 10.7% of affected workers are Black, despite being 8.7% of the workforce in these states. Meanwhile, 38.3% of affected workers are Hispanic, despite being 19.8% of the overall workforce in these states.
• The vast majority (87.4%) of affected workers are adults, not teenagers.
• A quarter (25.3%) of affected workers are parents. 4.8 million children live in households with at least one worker receiving a pay increase.
• Nearly half (49.4%) are full-time workers and 41.4% have at least some college education.
• More than one in five (21.0%) affected workers have household incomes below the poverty line and 48.8% are within 200% of the poverty line.

Boosting the minimum wage is good affordability policy

Minimum wage increases are an essential tool for putting money in workers’ pockets. As concerns about rising prices and affordability dominate the news cycle, it is critical to recognize that “affordability” is a function of both prices and wages. And while prices in most cases are unlikely to decline significantly, policymakers can make decisions that boost wages for workers. In Hawaii, the minimum wage increase from $14.00 to $16.00 an hour will raise annual wages by $1,346 for a full-time worker (see Figure A). Missouri’s increase from $13.75 to $15.00 an hour will boost annual wages by $920 for a full-time worker.

Price increases are squeezing workers today because lawmakers for decades have made policy decisions that suppress workers’ pay, including allowing the federal minimum wage to stagnate. The federal minimum wage has not increased from $7.25 an hour in more than 15 years, during which time its value has eroded by more than 30%. In 2025, the federal minimum wage is below the poverty line, but it is still the law of the land in 20 states that have more than 60.2 million total workers (see Figure B).

Policymakers can protect the value of the minimum wage over time as prices increase. Many of the states with small wage increases in January, like Minnesota, are making annual inflation adjustments to their wage floor. Not only do these adjustments automatically protect workers’ purchasing power over time, they also provide predictability to employers, allowing them to anticipate and plan modest adjustments to worker pay each year. Despite the prudence of inflation adjustments, conservative policymakers in some states have still opposed it. In Missouri, Republican lawmakers stripped a successful minimum wage ballot measure of its indexing provision, leaving low-wage workers vulnerable to a weakening wage standard over time.

In 2026, more workers will live in a state with at least a $15 minimum wage than a $7.25 minimum wage

In the past decade, dozens of states have passed significant minimum wage increases to counteract federal inaction. In 2026, minimum wages in Arizona, Colorado, Hawaii, Maine, Missouri, and Nebraska will reach or exceed $15 an hour for the first time, meaning that a total of 17 states and Washington D.C. will reach that threshold. For the first time, there will be more workers living in a state with a $15 or higher wage floor than workers living in states still stuck at $7.25 (see Figure B). These increases have taken place in urban and rural states as well as politically “blue” and “red” ones. This milestone reflects the progress of the minimum wage movement over the past decade but also underscores the gap between how workers in some states are paid relative to their peers doing the exact same jobs elsewhere in the country. There are still 14 million workers earning less than $15 an hour who have been left behind because Republican lawmakers at both the federal and state level have denied them a raise.

Figure B

More states could pass a $15 minimum wage soon, despite interference from conservative policymakers. In 2020, Virginia passed legislation to reach a $15 minimum wage by 2026, but the law required reauthorization by the state legislature by July 2024. Republican Governor Glenn Youngkin repeatedly vetoed those planned increases. Governor-elect Abigail Spanberger has promised to support a minimum wage increase. In Oklahoma, Republican Governor Kevin Stitt delayed a vote on a 2024 $15 minimum wage ballot measure until June 2026.

These delays not only push back potential wage gains for workers, they also chip away at the value of those increases because of inflation. Because the Oklahoma policy is a ballot measure, the language cannot be adjusted to account for the lost time since 2024. However, policymakers in Virginia could enact a new minimum wage target that accounts for the higher-than-expected inflation since the pandemic. This would likely mean a minimum wage of $16.64 in 2026 or $17.02 in 2027.1

Rising prices mean higher minimum wage targets are necessary throughout the country

Rising costs of living throughout the country will require policymakers to target minimum wages at higher levels than have been typical in recent years. When striking fast food workers in New York City sparked the Fight for $15 movement in 2012, the buying power of a $15 minimum wage was substantially higher than it is today. In 2025, a $15 minimum wage does not achieve economic security for working people in most of the country. This is particularly true in the highest cost-of-living cities. Table 1 compares the 2026 minimum wage and living wage for select metro areas across the country. The living wage standards are from EPI’s Family Budget Calculator (FBC), a measure of a modest yet adequate standard of living for families in each U.S. metro area and county. The living wage standards are for a single adult, assuming 81% of their total income is from wages.

The minimum wage does not exceed the FBC’s living wage in any county, but minimum wage increases make a significant difference for workers. Oklahoma City has the lowest living costs listed in the table, but the state minimum wage of $7.25 is only 42% of the living wage ($17.31). By comparison, Seattle will have a $21.30 minimum wage in 2026, almost 80% of the living wage in the metro despite its higher cost of living. Even outside of especially high-cost localities, strong minimum wage policies have set wage floors much closer to the living wage needs for workers. For instance, Missouri’s $15 minimum wage is 81% of the living wage in Kansas City, Mo. ($18.51).

Table 1

Workers are continuing to demand higher wages so that they can afford to live in the communities where they work. Hospitality workers in Los Angeles are poised to gain a $30 minimum wage, although the city council could water down the increases. The New York City mayoral campaign and new efforts in D.C. are also elevating ambitious minimum wage policies. As shown in Table 4, dozens of localities in Arizona, California, Colorado, and Washington are already implementing minimum wage targets above $17, $18, and $19 an hour. Seven localities in Washington will have minimum wages above $20 an hour.

Research has consistently shown that increasing the minimum wage remains a powerful tool for making the economy more equitable without causing job losses. The affordability crisis underlines how essential it is for federal, state, and local policymakers to take action so that workers are not left further behind, but lawmakers have taken relatively little new action on minimum wage policy in recent years. Of the 19 state increases this January, only two (Rhode Island and Michigan) are the result of policies passed in 2025. In addition, while Colorado, D.C., and Michigan all boosted their minimum wage this year, they also reinforced carve-outs for tipped workers. Even as millions of workers get raises this January, state and federal policymakers must do more to ensure their wage floors meet the needs of all workers.

Table 2

Table 3

Table 4

Note

1. According to CBO CPI-U projections in January 2020, $15.00 in 2026 was equivalent to $13.00 in 2020. If we adjust $13.00 an hour to account for actual CPI-U increases and CBO projections for future growth (September 2025 projections), the equivalent value is $16.64 in 2026 or $17.02 in 2027. 

Specifically, we have seen a long-term decline in male-dominated jobs—often jobs with higher pay thanks to higher unionization rates—alongside declines in men’s labor force participation (with the exception of the past decade). Meanwhile, female-dominated occupations are growing faster, but unfortunately many of these are currently lower-paying professions. To strengthen labor force participation, job quality and pay need to improve.

Employment losses were largest in male-dominated industries between 1976 and 2024

In a newly released report highlighting trends in men’s and women’s labor force participation, we describe how structural factors affecting industries and occupations are key to explaining historical trends in labor force growth. For men, large declines in military and manufacturing jobs went hand-in-hand with the decline in men’s labor force participation over much of the last 50 years. These were disproportionately a source of good jobs—where wage levels were high, non-wage benefits were common, and social prestige was high. Agriculture, mining, forestry, and fisheries, and wholesale trade also all experienced significant losses in employment between 1976 and 2024.

In frictionless labor markets, men should have responded to the declines in male-dominated sectors simply by moving into new jobs created outside of these sectors. But since alternative sources of employment often offered less attractive jobs for men (particularly non-college men), many men instead dropped out of the labor force entirely.

Jobs of the future are in health care and caregiving, historically female-dominated professions

By contrast, women are more likely to be employed in occupations that have grown in recent decades and are expected to keeping growing in the near future. Over the next decade, the Bureau of Labor Statistics projects that the fastest growing occupations will be in health care support, health care practitioners, computer and mathematical sciences, and community/social services. Women dominate the workforce in three of these four growing occupations: At least 70% of the workers in health care support and community and social services occupation groups are women.

Unfortunately, jobs in which women are overrepresented tend to provide lower pay and fewer benefits than male-dominated occupations, and wages tend to fall in occupations as the share of women increases. Health care support occupations, for example, only pay about three-fourths of the median wage overall ($37,000 versus $49,000). This wage is just barely above the poverty line for a family of four.

How occupational segregation affects men’s and women’s labor market choices 

It’s possible to draw the conclusion from the information above that men will continue to lose out on labor market opportunities and women will continue to gain opportunities, albeit at low pay. But jobs in growing fields such as health care and community and social services need not be dominated by women, nor must they be poor-quality jobs. Men and women make occupational choices based on a variety of individual decisions, as well as larger social and cultural influences. These occupational choices are shaped by a lifetime of experiences, educational expectations, hiring practices, and norms and beliefs about family roles and the division of household labor, which often track women into caregiving roles and men into technology and production roles. While this “occupational segregation” can have a big impact on labor market choices, policy that improves the quality of female-dominated jobs could improve labor market outcomes for both women and men.

Improving jobs of the future can support labor force participation for both men and women

In order for these jobs of the future to be attractive for men and women alike, health care support and community and social service jobs need to pay better wages, provide better benefits, and improve working conditions. The following policy goals would all contribute to stronger labor force participation:

• Tight labor markets would not only draw more would-be workers into the labor force but also give those workers more leverage to secure better pay.
• Stronger labor standards, such as a higher minimum wage and overtime protections, would improve those jobs and make them more appealing to a broader range of workers.
• Increased unionization would also improve pay in those jobs. On average, workers in unionized jobs are paid 8% more than workers in non-union jobs. There is no reason currently low-paid occupations, like health care support jobs, couldn’t enjoy the benefits of unionization. The share of unionized workers in health care support jobs has recently increased, and their wages are higher than those of their non-union counterparts. 

The post-pandemic labor market has given us some evidence that higher pay will translate into improved labor force participation. Despite the structural headwinds to men’s labor force participation imposed by the changing industrial composition of the economy, male labor force participation rates rose significantly in the past decade (and especially in the post-2019 period) as wage growth improved significantly, particularly for non-college workers.

There is no reason that jobs of the future should have bad job quality and low pay. Given that we know which jobs the U.S. economy will need in the next 10 years, policymakers should prioritize improving the quality of these jobs to ensure all workers will access them.