NOTE: We adjust 2018 minimum wage data for cost of living using the RPPs from 2017. In Missouri, the opposite is true: The state minimum wage is $7.85, but it's actually $9.27 when adjusted for Missouri's relatively low cost of living. But after adjusting for cost of living, New York's real minimum wage is only $6.26. For example, New York has a relatively high RPP (115.8) and its minimum wage is $10.40 (in 2018), which is higher than the federal minimum wage of $7.25.
Some states have real minimum wages that are actually lower than the federal minimum wage. To know for sure, we first need to calculate the real minimum wage for each state. Does that mean workers in that state earn a paycheck that's worth more than the federal minimum wage would provide? Maybe yes, maybe no. Some states set their minimum wage higher than the federal minimum wage of $7.25. So, Missouri's lower cost of living gives a boost to the value of a paycheck in that state.Ī state's cost of living also affects the value of its minimum wage. Missouri's MHI, adjusted for its own cost of living, was $56,436, compared with its unadjusted MHI of $53,578. median household income (MHI) was $60,336 in 2017. RPPs also let us compare income levels around the United States to show the real buying power of a paycheck for each state. For details on how these RPPs were calculated, see the BEA website. Orange bars indicate states of the Eighth Federal Reserve District, home of the St. NOTE: Click on the bars to reveal the three expenditure categories: goods, services, and housing. Values above 100 reflect higher-than-average costs and values below 100 reflect lower-than-average costs. The Bureau of Economic Analysis (BEA) computes an RPP for each state and Metropolitan Statistical Area (MSA) that depicts the state's or MSA's cost of living compared with a national average of all areas, which is 100. But how do you accurately compare income in a high-cost region with income in low-cost region? These graphs and maps use regional price parities (RPPs) to make even comparisons across the country. Louis with a new job in, say, New York City? You'd expect to pay more for most things in New York, but also to have a higher salary to compensate for the higher cost of living.
So how would you compare your current job in, say, St. Use our interactive maps, graphs, and tools to see how far your paycheck goes. Geography affects your cost of living, which affects your purchasing power.