A report from the Economic Policy Institute shows the truth behind the Southern economic development model. Southern politicians and businesses speak often of the economic development they are bringing to their states, claiming to usher in new economic prosperity for all. We see new ventures from Hyundai’s battery plants in Georgia to Meta’s data centers in Louisiana. However, when you peel back their rhetoric, not all that glitters is gold. These promises of prosperity have locked in a system of low-wage anti-union racist exploitation across the South.
For 40 years, Southern workers have been paid less than workers anywhere else, called the “Southern discount.” Today, over one in five workers earns less than $15 an hour. Eight of the ten lowest-wage states are in the South. Southerners are least likely to have health insurance, pensions, or paid leave. States like Mississippi, Louisiana, Alabama, and Tennessee don’t even set a minimum wage, leaving workers stuck with $7.25 – or $2.13 for tipped workers.
With weak enforcement, wage theft is rampant. In Florida, one in four low-wage workers is paid below the legal minimum as a result. Nearly one in five in Louisiana and Mississippi lives below the poverty line. Child poverty across the South is 18%, but for Black children it’s 30%. This locks generations into poverty before they ever have a chance.
This is all by design. After emancipation, lawmakers carved agricultural and domestic workers – jobs held largely by Black workers – out of New Deal protections like the minimum wage and union rights. That legacy remains. Black and Brown Southerners’ work is still systematically devalued.
The result: a region held down as a pool of cheap labor – great for corporate America, devastating for working families. To make matters worse, tax dollars that could fund desperately needed social services and spending on working families instead go to corporate tax breaks to attract more business.
Between 2017 and 2023, South Carolina handed out $3.2 billion. In Texas, data center deals alone will strip $1 billion from the 2025 budget. That money comes out of schools, health care, disaster response, and public goods, straight into corporate profits.
Southern workers have never just accepted their lot, but have organized and resisted. From the textile strikes of the 1930s, to Memphis sanitation workers in 1968, to today’s fights in Amazon warehouses, auto plants, and Waffle House kitchens,
As W.E.B. Du Bois said, “So goes the South, so goes the nation.” The Southern model doesn’t stay in the South – it drags down workers everywhere. Corporations threaten, “If you won’t take less here, we’ll move South.” That’s why building unions and fighting in the South lifts the entire working class.
The politicians and CEOs have had their say. They’ve sold off schools, blocked Medicaid, and let corporations pollute our air and water – while calling it all “good for business.”
The solution is clear: organize, unionize, and fight for an economy that works for us, not just the rich. The South is not impossible to organize. Even in the least unionized states, workers want unions! South Carolina may have the lowest union density, but 2 in 3 workers overall and over 8 in 10 Black workers support unions. History shows that when workers unite – overcoming fear, racism, and hopelessness – they win real gains and terrify the powers that be.
If we can win in the South, we can change everything.
