The average American family earns about $20,000 more in inflation-adjusted annual income today than in 1970, but growth has varied widely across the 50 states, with some doing better than others—and in some, households are actually in worse shape now than they were a century ago.
The Urban Institute’s Housing and Communities Division published a new study that analyzes data from the US Census Bureau, the American Community Survey, and the Integrated Public Use Microdata Series (IPUMS) to determine how median household income has changed from 1970 to 2023 in all 50 states.
The bottom line is that Western, Mid-Atlantic, and New England states have seen the fastest income growth since 1970, while Midwestern states have seen much weaker gains.
West Virginia was the only state in the nation where median income declined, falling from $56,161 in 1970 to $55,948 in 2023 in inflation-adjusted dollars — a 0.4% decrease.
The top performer over the period covered by the study was Utah, where median household income rose a staggering 77.6%, from $52,602 to $93,421 annually. Households in Colorado fared similarly, seeing their incomes increase nearly 67%, from $55,766 to $92,911.
Income in New Hampshire gained just over 62%, followed by California at 61%, and Arizona rounded out the top five at 60.2%.
Other states that saw strong income growth include Texas (48.5%); Idaho (48%); Massachusetts (47.7%); and Washington (45.9%).
At the other end of the spectrum, excluding West Virginia, where incomes were in the red in 2023, Michigan families experienced the smallest increase in inflation-adjusted income from 1970 to 2023, just 2.9%, from $67,235 to $69,183—a gain of less than $2,000.
Missouri did even better: There, median income grew 13.3%, to $68,545.
Indiana’s growth rate was the fourth slowest in the US, at just 14.1%, followed by Pennsylvania, at 15.2%
Additional states that saw median income gains over 53 years were Ohio (16.6%); Alaska (18.4%); Wisconsin (18.7%); Iowa (20.4%); and Mississippi (22.4%).
Other states fell somewhere in between, with gains ranging from 25% to 45%.
Nationally, the median household income in 2023 was $77,719, an increase of about 32% – or another $18,000 – compared to 1970.
What is driving the growth of unequal income?
According to the authors of the 10-page analysis, Brett Theodos again Brady Meixeleducational attainment was the most important factor driving income growth at the state level.
“States with the largest increases in residents with bachelor’s degrees tend to be those with the largest increases in median household income,” the study reads.
Another important factor strongly associated with household income gains was the share of immigrants in the province’s population.
“This may be because immigration leads to economic growth, immigrants seek growth areas, or both,” the researchers wrote.
Contrary to conventional wisdom, states with colder temperatures and higher property taxes saw more average income growth than their counterparts with warmer climates and lower property taxes.
The study also found that federal sales and income taxes have no effect on changes in family income.
Utah. vs. West Virginia
Based on the study, changes in natural resource extraction appear to have made a difference in income growth in Utah and West Virginia.
In the 1970s, the top coal-producing states were West Virginia, Kentucky, and Pennsylvania. Ten years later, coal output declined in these states but increased in Wyoming, Montana, Texas, Colorado, and Utah.
Unlike the Appalachian states, however, Utah has not traditionally relied on coal operations to support its economy, so when the industry went down, it didn’t hit the Beehive State as hard as it did West Virginia.
Additionally, Utah had thriving technology and financial companies to keep the state’s diverse economy thriving and household income growing at a healthy pace.
“Overall, the findings of our analysis may justify states’ focus on spending on education and workforce development while suggesting that reducing tax burdens has been less effective in promoting revenue growth,” concluded Theodos and Meixell.
How does income growth relate to housing affordability?
Perhaps surprisingly, strong income growth does not translate into larger home purchases. In fact, the opposite is often true.
As of December 2025, Michigan, Missouri, and West Virginia all had housing affordability scores above the national average, according to Realtor.com® data.
“Although incomes in these states have not improved since the 1970s, home prices remain so low that buying a home is easier than anywhere else in the country,” said Realtor.com’s top economist. Joel Berner.
In July, West Virginia posted the lowest median list price in the US at just $270,000. According to an analysis of Realtor.com data, to own a home in the Mountain State without spending too much, a family needed to earn about $71,000 a year, which was 18% higher than the state’s real income.
Meanwhile, Utah, Colorado, and New Hampshire were all less affordable than the US as a whole.
“Income growth in these states has fueled housing price increases that make their income growth meaningless from a housing perspective, as it is still difficult for residents to afford housing,” added Berner.
