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WAGE STAGNATION VS. LIVING WAGES  
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Robert Pollin
November 3, 2025
Dollars & Sense
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_ Far from earning living wages, most U.S. workers have experienced
wage stagnation since the 1970s--a trend largely obscured by political
rhetoric and misinformation. _

, iStock.com/baonaR

 

At the end of last August, President Donald Trump asserted
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average wages for U.S. workers had risen by $546 during the first six
months since he returned to office in January 2025. As with virtually
all of Trump’s pronouncements, this one bears little relationship to
the truth. In fact, when using the most reliable government data on
wages and then controlling for inflation, workers’ wages did still
rise under Trump, but by $26—that’s 95% less than the $546 average
pay raise proclaimed by Trump.

The reality of wage stagnation under Trump is fully consistent with
his broader attack
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working people. As just one example, the labor historian Joseph
McCartin called
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move in March to cancel the union rights of more than one million
federal government workers “by far the largest single action of
union-busting in American history.”

Still worse is that wage stagnation to date under Trump follows what
is now a 50-year pattern.   In 1973, the average nonsupervisory
employee earned
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an hour (in 2024 dollars
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As of 2024, that average wage was $30.13. Over the same time period,
the average productivity
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U.S. workers—the average value of what they produce when they show
up at work—rose by 150%. If these workers had received raises every
year between 1973 and 2024 just equal to their increased productivity,
but not a penny more, their average hourly pay today would be $72.88
an hour. 

To further clarify the current pay levels for nonsupervisory workers,
compare their current average hourly wage of $30.13 with what we could
consider a living wage standard. There are various ways in which one
can define what we mean by a living wage. In _A Living
Wage:  American Workers and the Making of a Consumer Society_
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Lawrence Glickman defines the term qualitatively, as being a wage
level that offers workers “the ability to support families, to
maintain self-respect and to have both the means and leisure to
participate in the civic life of the nation.”  

A research group at the Massachusetts Institute of Technology (MIT)
has produced a Living Wage Calculator
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detailed annual quantitative estimates of living wage standards for
every state and county in the United States, as measured relative to
the cost of living in each area. Their definition of what constitutes
a living wage in a given community is less ambitious than the standard
suggested by Glickman. Specifically, according to the MIT
Calculator’s definition, “The living wage is the basic income
standard that, if met, draws a very fine line between the financial
independence of the working poor and the need to seek out public
assistance or suffer consistent and severe housing and food
insecurity. In light of this fact, the living wage is perhaps better
defined as a minimum subsistence wage for persons living in the United
States.”

Working from this lower-end but still reasonable definition, the MIT
researchers estimate living wages for various family household types,
including those with one or two adults and between zero to three
children. For example, their living wage estimates at the state level
for family households with one adult and one child range between a low
of $32.62 an hour in Mississippi and a high of $55.15 an hour in
Massachusetts. These figures yield the striking result that even the
low-end Mississippi living wage of $32.62 an hour is 8% above the
$30.13 average now being earned by nonsupervisory workers in the
United States. The $55.15 Massachusetts living wage is 83% higher than
the current average hourly wage of $30.13.      

Since the early 1990s a strong political movement in the United States
has fought to establish living wage standards at the municipal and
state levels. The movement has  achieved some significant successes
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Between 1994 and 2010, living wage laws were enacted in over 125
cities and counties. At the state level
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30 states and Washington, D.C., now have minimum wage rates above the
poverty-level federal minimum of $7.25 an hour. Washington State has
the highest state-level minimum wage at $16.66 an hour. The minimum
wage for Washington, D.C., is still higher, at $17.95 an hour.  

Yet these state and city living wage rates remain uniformly well below
even the MIT Calculator’s lower-end standards. Given the broader
50-year pattern of wage stagnation in the United States, we cannot
avoid the conclusion that the living wage movement has not been
successful enough, despite great efforts by thousands of organizers
and activists throughout the country.

Under Trump, we can only expect more of the same outright lies and
vicious assaults on workers’ rights, job opportunities, and living
standards. It is therefore now imperative to revive the living wage
movement throughout the country. A ramped-up living wage movement can
become one important force contributing to the resistance against
Trump and Trumpism. More fundamentally still, a revived living wage
movement can be a means for building working class power and, with
that power, delivering pay levels for nonsupervisory wages
that—after 50 years of U.S. wage stagnation—can reach true living
wage standards.  

_Robert Pollin is a distinguished university professor of economics
and Co-Director of the Political Economy Research Institute (PERI) at
the University of Massachusetts-Amherst._

_Dollars & Sense_ is a non-profit, non-hierarchical, collectively-run
organization that publishes economic news and analysis, with the
mission of explaining essential economic concepts by placing them in
their real-world context.

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* wages
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