Americans face a dilemma. The Consumer Price Index rose 7% in December. While wages have risen recently, they have not, for the most part, kept up with inflation. The median household income in the U.S. dropped 2.9% in 2020 to $67,521. In a recent article, a reporter from The New York Times wrote: “Only 17 percent of workers say they have received raises that kept up with inflation over the past year, according to a survey of 5,365 adults conducted last month…”
Another contributor to the uncertain future about the income of Americans is the record number of people who have quit their jobs, and the record number who appear in no rush to become employed. In recent months, several million people have quit their jobs each month. Some of these have retired because of the COVID-19 pandemic. Others believe they can find better-paying jobs. And, the labor market is tight. The jobless rate nationwide was 3.9% in December.
Raw numbers about the national situation can be misleading. In November, according to the BLS, 1.9% of the working population of Nebraska was unemployed. In California, the figure was 6.9%.
Another sharp difference among states is how much people make. The highest median household income among states is Maryland at $86,738. In Mississippi, it is $45,792.
The cost of living by state tends to match household income. People cannot afford expensive goods and services. This means prices have to be set to a market that is driven by these low wages.
According to the Missouri Economic Research and Information Center’s Cost of Living Data Series…
Mississippi had the lowest cost of living as of the end of the third quarter of 2021. The data were based on the costs of groceries, housing, utilities, transportation, and healthcare. The index used to rank states was a composite of these. Mississippi’s index was 85.1–the lowest. The low figure was driven to a large extent by the very low cost of housing.
In the middle of the list, Pennsylvania had an index of 100.5. The state with the highest index was Hawaii at 185.6.
Click here to read What Income Is Considered Middle Class In Your State
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