Minimum Wage and Cost of Living

We already looked at minimum wage over time and saw how some states match the federal limit, some pay above, and others have no limit. But when it comes to geography and income, you also have to consider the cost of living.

One dollar in Kentucky or Arkansas won’t get you as much in Hawaii or California, because it costs more to live in the latter states.

The Bureau of Economic Analysis has an estimate for this difference. It’s called Regional Price Parity, which considers spending in each state and compares it against national price levels. Each estimate is expressed as a percentage.

For example, Hawaii had the highest RPP in 2019 at 119.3, meaning the cost of goods and housing was 19.3% higher than national price levels.

If we use the RPP to estimate the value of $100 in each state and plot the result against minimum wage over time, we get the chart below.

 

Generally speaking, the states that are more expensive to live in have a higher minimum wage to compensate. In contrast, the states with no minimum wage tend to have a lower cost of living.

The sweet spot is that upper right quadrant where both minimum wage and value of your dollar are relatively high. While no states make it all the way to the top right, Arizona is looking decent in that regard. Going the other direction, if I were living on minimum wage, I might want to steer clear of New Hampshire.

Become a member. Support an independent site. Make great charts.

See What You Get

Learn to Visualize Data See All →

How to Untangle a Spaghetti Line Chart (with R Examples)

Put multiple time series lines on the same plot, and you quickly end up with a mess. Here are practical ways to clean it up.

How to Make Line Charts in Python, with Pandas and Matplotlib

The chart type can be used to show patterns over time and relationships between variables. This is a comprehensive introduction to making them using two common libraries.

How to Make a Multi-line Step Chart in R

For the times your data represents immediate changes in value.

How to Use Packed Circles in R

Adjust coordinates, geometries, and encodings with packed circles to make various types of charts.

Favorites

10 Best Data Visualization Projects of 2017

It was a rough year, which brought about a lot of good work. Here are my favorite data visualization projects of the year.

Top Brewery Road Trip, Routed Algorithmically

There are a lot of great craft breweries in the United States, but there is only so much time. This is the computed best way to get to the top rated breweries and how to maximize the beer tasting experience. Every journey begins with a single sip.

What Qualifies as Middle-Income in Each State

The meaning of “middle-income” changes a lot depending on where you live and your household size.

Real Chart Rules to Follow

There are rules—usually for specific chart types meant to be read in a specific way—that you shouldn’t break. When they are, everyone loses. This is that small handful.