Where Americans Earn the Most: States Combining Top Salaries With Economic Opportunity

Your zip code matters. The state you choose to build your career in can dramatically influence not just what you earn, but how far that income stretches. A comprehensive analysis examining affordability, wage growth, employment rates, tax burden and earning potential reveals the geographic advantages that matter most for workers seeking both competitive compensation and financial stability.

The Tax Factor: Why No-Income-Tax States Aren’t Always the Best Deal

Before mapping your next career move, understanding the full tax picture is essential. While zero-income-tax states like Florida, Texas, and Alaska appear attractive at first glance, financial experts note that states forgoing income tax revenue often compensate through alternative taxation methods. The result? Your overall tax burden may not actually improve in a no-income-tax jurisdiction. Colorado, Washington and Montana, for instance, apply state income tax but offset this with other economic advantages that make them competitive destinations for high earners.

The Data: Which States Reward Workers Best?

Research from Affordable Contractors Insurance examined 10 top-performing states across six critical metrics: affordability index, median annual salary, average wage growth rate, state income tax burden, employment rate, and earning potential index. The findings highlight states where skilled workers can genuinely advance their careers while maintaining purchasing power.

Washington State leads with the highest median annual salary at $78,130, combining this with a robust 5.8% average wage growth and strong 95.5% employment rate. For those pursuing highest paid trade jobs and technical positions, Washington’s diverse economy creates sustained demand.

Colorado ranks closely behind with a $71,960 median salary, exceptional affordability index of 95, and growing opportunities across multiple sectors. Alaska offers compelling $69,880 median compensation with zero state income tax, though its lower affordability index reflects the cost of living realities in northern regions.

Florida and Texas both maintain 0% state income tax while delivering solid median salaries ($60,210 and $61,240 respectively) and employment rates above 95%. Florida distinguishes itself with an impressive 5.1% wage growth rate.

Employment Stability Across Top-Earning States

What often gets overlooked in salary discussions is employment reliability. North Dakota boasts the nation’s highest employment rate at 97.5%, followed closely by South Dakota at 98.1% and Montana at 97.1%. These Northern Plains states demonstrate labor market resilience even with more modest median salaries ($59,050, $53,230, and $55,920 respectively).

New Hampshire and Utah round out the top tier with employment rates of 97% and 96.7%. Utah particularly stands out for workers seeking highest paid trade jobs, offering a $61,070 median salary, 4.0% wage growth, and 5% state income tax with strong industry diversification.

The Real Earning Potential Index

Beyond raw salary figures, earning potential—measuring long-term income growth trajectory—reveals which states truly reward career advancement. Florida leads here with an earning potential index of 99, followed by Colorado at 90 and Washington at 88. These states combine immediate competitive wages with industries and economic conditions that support upward mobility.

Conversely, Montana’s earning potential index of 74, while lower, still reflects meaningful wage growth at 5.6%—the third-highest among the 10 states examined, making it attractive for workers prioritizing growth rate over current salary.

Geographic Diversity: No One-Size-Fits-All Answer

The data reveals no single “perfect” state, but rather distinct advantages by region and priority:

• Pacific Northwest (Washington): Highest salaries, strong growth, moderate affordability
• Mountain West (Colorado, Utah, Montana): Balanced compensation, good growth rates, mixed tax burden
• Great Plains (North Dakota, South Dakota): Exceptional employment stability, lower salaries, minimal competition
• Sun Belt (Florida, Texas): Zero income tax, solid salaries, high employment, growing wage gains
• Alaska: Premium wages offset by higher living costs and extreme geographic isolation

Making Your Move: Key Research Steps

Before relocating for career advancement, consult U.S. Bureau of Labor Statistics data on your specific field’s regional job growth and unemployment trends. Industries cluster geographically—tech concentrates in Washington and Colorado, energy in North Dakota and Alaska, construction and trades across multiple states offering highest paid trade jobs opportunities.

Tax planning requires looking beyond state income tax to sales tax, property tax, and cost of living factors. An $80,000 salary in Washington differs substantially in purchasing power from $80,000 in rural Montana or Alaska.

Sean O’Keefe, CEO of Affordable Contractors Insurance, emphasizes that “states with diverse industries, high demand for skilled workers and robust economic expansion create genuine pathways for career progression and income growth.” The data bears this out: opportunities cluster not in any single region but across economically dynamic states willing to invest in workforce development and maintain competitive tax environments.