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The 5 States Where Salaries Have Risen the Most Over the Past Decade

Joel Rogers | Corbis Documentary | Getty Images

Salaries have steadily increased across the United States over the past decade, but workers in some states are growing their pay at a faster rate than others, according to a new report from Approve.com. 

The spending management software firm looked at salary information from the Bureau of Labor Statistics and compared the average wage in 2010 for each state with the average wage in 2020. Researchers found that some places saw a nearly 50% jump in their workers' salaries while others saw only a 25% increase. 

According to the BLS, the average wage for all Americans rose 27% between 2010 and 2020, from $44,410 to $56,310. Four states with the highest-growing salaries top this average wage: Washington, California, Massachusetts and Oregon.

Bureau of Labor Statistics Division Chief Michael Wolf tells CNBC Make It that there are several factors inflating workers' salaries in these states, including the addition of new, high-paying occupations in the technology and healthcare fields and the loss of low-paying jobs such as retail and restaurant employees during the pandemic.

Washington saw the largest increase in its workers' pay at about 58%. In 2010, Washington's average annual wage ranked 10th of all the states, but in 2020, its annual wage of $76,791 is the fourth highest in the country. California experienced the second-highest spike in its average annual wage at about 49%. In both states, the percent difference is far higher than salary growth for the country overall.

"This list isn't at all surprising," Wolf notes. "Both Washington and California have extremely strong technology sectors with lucrative salaries, and other high-growth states, like Oregon and Massachusetts, have bumped their minimum wages more so than their neighboring states."

North Dakota, however, is a bit of an outlier. It ranks third for highest-growing salaries, but much of this success has been driven by an oil and fracking boom within the state over the past decade. "The state has seen a huge increase in hiring for this sector, but it was very hard to convince workers to move to North Dakota, so employers had to offer very high wages to incentivize people," Wolf says. "We've seen truck drivers there getting offered six-figure salaries."

Other states' wages have fared worse over the last ten years: Wyoming, Louisiana, Mississippi and Alaska all saw small gains in their states' average wage. It's no coincidence that these are also some of the poorest states in the country, Mark Hamrick, a senior economist at Bankrate, says. "The wealth gap has only deepened, making poverty a cycle that's very hard to escape," he adds. "The economies in Louisiana and Alaska are both very reliant on energy, too, so their success has been subject to volatile energy prices … that can be a feast or famine situation." Another state in economic pain, Connecticut, has a market dominated by retail and hospitality jobs, many of which were lost during the pandemic. 

Hamrick predicts that more working professionals, in search of higher wages and more career opportunities, will consider moving to states where salaries are growing. "But this trend isn't without its downside, as many of the sought-after markets in these states come with a higher cost of living," he warns. 

The ongoing pandemic, however, and continual rise of remote work opportunities, is granting more workers the option to have a profitable job and live in a less expensive state. "That's going to be one of the tremendous opportunities of remote work," Hamrick adds. "People are finding new opportunities to optimize their work-life balance by moving to more affordable regions where they can have the best of both worlds."

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