Workers are creating more value than ever, but earnings aren’t keeping up with prices. Between 2017 and 2025, median weekly earnings grew by 38 percent, while average child care and health care costs increased by 40 percent, and rents increased by 50 percent.

Though market forces contributed to this disconnect, policy choices also play an enormous role. Minimum wages haven’t kept pace with the cost of living, declining unionization (PDF) has eroded workers’ ability to bargain for fair compensation, and policies that help workers keep what they earn and improve their pay haven’t kept up with new employment arrangements.

As a result, about half of people in the United States don’t have the resources they need to cover what it really costs to live securely in their community.

Much of the public debate on affordability focuses on costs, but the data show that job quality and earnings are also a critical factor. Here are seven evidence-backed strategies—many budget neutral—state and local policymakers can implement to make life more affordable for working Americans by focusing on earnings:

1. Increase minimum wages and access.
   
   State and local policymakers could index wages to inflation. This year, 14 states (PDF) will reach or exceed a wage floor of $15 per hour, and 13 states and 44 local jurisdictions will make annual cost-of-living adjustments in 2026. Most research since 2010 finds that the impact of minimum wage hikes on job loss tends to be close to zero. 
   
   Policymakers could expand access to fair wages by covering additional workers. For example, seven states require that tipped workers receive the same minimum wage as other covered workers, rather than the federal tipped subminimum wage of $2.13/hour. 
   
   Finally, policymakers could also codify which specific workers are covered by the minimum wage so that workers in their jurisdiction will still be covered even if federal coverage definitions change.
2. Enact secure scheduling policies. 
   
   State and local policymakers can give workers more control over their work time. Secure scheduling policies can ease households’ costs by allowing people to save money by planning ahead, avoiding high costs for contingencies like ride share when a shift is added to their schedule last-minute and they need to get to work. Flexibility in scheduling can also allow parents to schedule shifts around a child’s school hours and reduce the need for child care.
   
   These policies also improve retention rates, which benefits both workers and employers and increases workers’ likelihood of higher earnings over time. Ten cities and the state of Oregon have enacted scheduling laws that make earnings more predictable, which improves families’ ability to pay their bills on time and avoid high-cost debt. 
   
   Ensuring part-time workers who would like additional hours are able to get them can also boost total earnings.
3. Implement wage and labor standards for government workers and contractors.
   
   This will help state and local policymakers ensure public funds support quality jobs. Policy models include requiring government contractors to demonstrate sound past performance, compliance with basic labor standards, and/or pay a living wage; incentivizing bidders to include job quality standards in their proposals; requiring contractors to address job quality after winning the bid; or including pay-for-performance bonuses dependent on job quality outcomes.
4. Ensure workers’ rights are protected.
   
   State and local policymakers can strategically enforce (PDF) existing labor laws to combat wage theft, illegal retaliation, and other employment violations and ensure workers are paid what they earn. 
   
   In addition to providing adequate public funding for state and local labor enforcement agencies, jurisdictions could experiment with strategic partnerships between government, workers’ rights organizations, and other community-based organizations to efficiently target resources.
5. Expand workers’ rights to collectively bargain.
   
   States can ensure workers have a say in determining their wages, benefits, and job quality. For the average full-time worker, the decline in unionization over the past four decades translates to an annual income loss of $3,250. 
   
   In addition to protecting workers’ rights to unionize, states can also experiment with alternate forms of collective bargaining like sectoral bargaining and wage boards, both of which hold promise at a time when employment arrangements are shifting and traditional labor regulations cover fewer workers.
6. Advance paid family and medical leave (PFML) policies.
   
   States can provide universal access to earned benefits for workers who need to take time away from work to care for a new child, an aging family member, or their own serious medical condition. PFML benefits ensure families can still afford their living costs during periods away from work. 
   
   Paid leave can lower families’ expenses too—for example, by allowing a working parent to delay child care costs by staying at home to bond with a new baby or by allowing a family to delay or avoid nursing home costs by enabling an aging parent to age in place. 
   
   Longer-term PFML has also been shown to boost labor force participation among parents and other caregivers, helping ensure working caregivers continue to climb the earnings ladder with minimal impact on employers.
7. Update state unemployment insurance 
   
   Stronger unemployment insurance can help states support workers’ earnings mobility, ensuring a bump in the road doesn’t turn into an off-ramp from the labor market. It could help working households afford basic needs while they search for new work, which would be especially helpful if the job market continues to cool. 
   
   States could leverage federal funding to create short-time compensation programs allowing employers to retain workers during downturns, and they could consider adopting a 26-week maximum benefits duration and experiment with expanding allowable separations (such as for compelling family reasons).

Efforts on the cost side of the affordability equation are essential, but tackling the cost side alone won’t solve the crisis. Policymakers need to focus on both sides of the ledger: not just reducing what families have to spend but also increasing what they earn. The evidence shows an affordability agenda that delivers real results should include policies that raise wages, improve job quality, and strengthen workers’ power to advocate for themselves.