State of Working Wisconsin - gaining ground, but higher earners are still behind

Wanted to mention a few things on the recently released State of Working Wisconsin report for 2026. It's put out by High Road Strategy Center at UW-Madison And on the wage-earning side, this report says Wisconsin was performin well by the end of year.

In 2025, Wisconsin’s median wage – $26.17 per hour – reached a new high (see W2). Workers in the state have experienced three years of solid wage growth that have more than made up for the damage to wages inflicted by the very high inflation of 2022. From 2022 to 2025, the inflation-adjusted value of wages grew by $2.00 per hour. Further, the current wage is $4.00 higher than the 2015 median. This advance in wages is unprecedented in the data we have. Real wage growth in the past decade is stronger than in any period back to 1979. The 2025 Wisconsin median wage slightly exceeds the national median (which is unusual but not unprecedented).

The long-term view provided by W2 shows how remarkable the last decade of wage growth has been. Wisconsin workers actually lost ground in the 1980s with wages falling to well below the national median. Wisconsin began to make up the wage loss and finally got ahead of the 1979 median wage toward the end of the growth of the 1990s.

In the early 2000s, wages were stagnant, and the Great Recession brought wages to the 21st century’s low point in 2012. Wages grew slowly from 2012 until 2018 during the sluggish recovery from the Great Recession.

Since 2018, however, wage growth has been strong. While high inflation in 2022 brought wages down, wages grew in 2023, 2024, and 2025, and in each of the last two years, Wisconsin has reached a record high.

I did find it interesting that the report had data showing Wisconsin with slightly higher wages vs the rest of the country at the 20th and 50th percentiles, but trailing when it comes to higher-paying jobs.

This goes along with the recent “brain drain” report from the Wisconsin Policy Forum, which showed college-educated Wisconsinites frequently going to higher-paying states like Minnesota, Illinois and California.

That said, while we still lagged behind in 2025, higher-paid workers in Wisconsin have gotten stronger wage gains (by percentage) than the rest of the country over the last 6 years.

But these increased wages in recent years haven't necessarily made it easier for Wisconsinites when it comes to paying their bills and/or getting ahead. The High Road report mentions that times are still tough for many Wisconsinites, as their everyday costs are outpacing whatever their incomes may be going up by. And it may well get worse in the near future.

To provide a picture of issues around affordability, we draw on Wisconsin data from United for ALICE. This United Way project identifies the ALICE (Asset Limited, Income Constrained, Employed) in each state. The ALICE Household Survival Budget includes only essential expenses, such as housing, food, transportation, child care, health care, technology, and taxes. The ALICE standard is more conservative than other basic budget standards. (See EPI’s Family Budget Calculator and the MIT Living Wage Calculator for alternative models of the disconnect between wages and costs of living).

The ALICE standard shows that more than one-in-three households in Wisconsin (35% of households) faced financial hardship. Of these households, 11% were below the federal poverty line, another 24% of the state’s households earned more than the poverty-level but still faced considerable financial hardship and did not earn enough to afford a minimal cost of living. This kind of struggle – working people who do not earn enough to make ends meet – is a long-standing problem for working people in the state. Between 32-35% of Wisconsin families have faced financial hardship since 2010….

As energy, food, and housing prices rise, families feel increasingly squeezed. Recent analysis shows that utility bills are growing rapidly: Wisconsin households are paying 19% more today than they were in 2022. The federal approach to tariffs has increased costs for families by $1,100 per year according to the Budget Lab at Yale. The federal budget cuts for health insurance, Medicaid, and food assistance are making life more expensive for working families across Wisconsin. Many of the biggest cuts to Medicaid are yet to come.

Which should tell you that while it's nice that Wisconsin was outpacing the country's wage growth in 2025, it wasn't necessarily translating into a better life. And we know prices have gone up more while wage growth has gone down in 2026, so this time next year, we might well see the real wage gains of 2023, 2024 and 2025 go away.