Wage Change Insights (2)
The state of Arkansas has not experienced significant change throughout the last two decades, remaining one of the poorest of all fifty states. The reasoning for Arkansas' minimal change is due to their lack of opportunity; for as compared to other states, in the last two decades Arkansas is listed as having one of the worst educational systems, infrastructure, as well as having one of the highest crime rates. To add to the lack of opportunity, Walmart is the only mega-company with a headquarter located within the state. California is significantly different from Arkansas, as it is the most diverse state in terms of the economy. Although the minimum wage has risen in the last two decades, it does not match the rate of inflation, thus resulting in high levels of poverty. In the early 2000s, Silicone Valley was the primary source of revenue; however, although technology companies still exist, much of California's economy has now shifted to agriculture and other service products. Compared to any other state, California took the most damage in the 2008 recession (lasting until 2012). Similar to California, the state of Colorado has also experienced a rise in minimum wage; but unless one lives in the Denver metro area (where housing and rental houses have increased their price dramatically in the past decade), living on a minimum wage salary is manageable. Colorado is unique in that it has had a large influx of young individuals that have become residents within the last decade, which research indicates could be partly due to marijuana being legalized for recreational use. The consequence of this influx is that the state has a population that is under-qualified for well-paying professions. Although the state has a large majority of unqualified individuals, the presence of large financial corporations, successful ventures, and other government agencies, could explain why Colorado ranks high for average wages.
- Between 2000-2014 Arkansas implemented the same minimum wage issued by the federal government. However, in 2015 a plan was issued to increase the minimum wage annually (which also included gratuity workers receiving a small pay increase). Consequently, non-exempt, full-time employees received $7.50 per hour in 2015, $8.00 per hour in 2016, $8.50 per hour in 2017, and $9.25 per hour in 2019.
- The three-year median-average income between 2002-2004 was $33,948, placing Arkansas third to last as the lowest income state to live in during the beginning of the 21st century. Between 2009-2011 Arkansas ranked 49th of the 50 states, having a 3-year median income of $39,806.
- The inability to rise in rank has continued throughout the last decade. According to a 2019 census, citizens of Arkansas have a 17.2% chance of being in poverty, as compared to the national average of 11.8%.
- The headquarters of the largest organization in the world, Walmart, is located in Arkansas, but there are only six other Fortune 500 companies located within the state.
- The total GDP has risen steadily (not including the 2008-2009 dip), from $68.77 million in 2000 to $128.42 million in 2018.
- Arkansas has the worst healthcare in the United States and ranked in the worst 10 states for having high crime rates, infrastructure problems, citizens with a lack of education (and the lack of opportunity for the youth to become educated), and a low GDP.
- Despite having one of the highest inflation rates in the country between 2000 and 2019, the minimum wage has only risen from $6.25 in 2001 to $12.00 in 2019 (with the exception of a few counties that offer a higher minimum wage rate), thus, making it one of the most expensive states to live in the United States.
- In 2019, California was tied in the top three for the highest poverty per family, with one out of five families unable to acquire basic physiological needs. However, there is wide diversity within the state, as many high-paying jobs remain operational in Silicone Valley.
- In 2000, California was ranked sixth in the world's largest economies, and the largest sector was services (which included high paying technological jobs located in Silicone Valley). Although experiencing economic hardships in the 1990s, California came back strong in the 2000s, surpassing the rest of the United States in job growth.
- In 2009, California was ranked in ninth place as being the largest economy worldwide. Due to the recession, all sectors (except for education) experienced a sharp decline, with construction and trade/transportation/utilities being hit the hardest. Furthermore, the state had significant budget shortfalls in both 2001 and 2008, requiring increases in state taxing and a one-time federal bail-out plan in 2009.
- California was most likely hit the hardest during the 2008 financial crises as, unlike the majority of other states, they were stuck in the grueling financial recession until 2012. This is most likely due to decreases in state income, corporate taxes, and other taxes in the years prior to 2008.
- After Colorado's implementation of The Colorado Minimum Wage Act 24, their minimum wage for both non-exempt regular and tipped employees has been increasing on an annual basis. In 2019, the minimum wage for non-exempt employees was $11.11 for regular employees and $8.08 for tipped employees, which is much higher than the federal minimum wage for non-exempt regular employees ($7.25) and tipped employees ($2.13). Although Colorado has had an increase in inflation rate as compared to the rest of the country, one dollar in Colorado in 2000 was only worth $0.07 more than one dollar in 2000 that is influenced by the federal inflation rate. This could explain why Colorado is ranked 7th for average wages per year as compared to the other 50 states.
- Due to the legalization of recreational marijuana in 2014, which resulted in an excess of entry-level positions, Colorado experienced historic lows of unemployment rates by 2017. The consequence of an excess of entry-level positions was that the median hourly wage was 2% lower than the median hourly wage in 2000 (after adjusting for inflation rates). Note: As the median is the middle number, the overall population size (which is largely compromised of entry-level employees) has a large impact on this statistic. The outliers making significant amounts of money are not provided much weight in the calculation.
- A survey conducted in 2019 displayed that 7 out of 10 residents of Colorado found it more difficult to make a living than it used to be (the questionnaire was not specific of the time frame). A large factor in this could be the home prices in Denver, which have experienced a 104% price increase in the past decade, and the monthly rent, which is on average 85% higher.
- Although there appears to be an influx of entry-level positions, in 2019, the largest industries in Colorado were finance, insurance, and professional and business services. Furthermore, there are a number of government-run agencies such as NORAD. As these are considered high-paying jobs, this could explain why Colorado has a high average wage despite the high number of entry-level employees.