Income growth: If growth were inclusive, lower-wage workers would see their incomes rising.
Insights & Analyses
- Full-time workers with the lowest incomes at the 20th percentile and below in the Nine-County Bay Area saw their incomes decline or stagnate between 2000 and 2020, while workers at the 50th percentile and above saw their incomes increase.
- Income for workers at the 10th percentile in the region dropped 3 percent between 2000 and 2020, while income for workers at the 90th percentile increased 30 percent.
- In all Bay Area counties except San Francisco and Alameda, income for workers at the 10th percentile declined between 2000 and 2020, with the steepest decline of -15 percent in Solano County.
- Top earners in the Bay Area (those at the 90th percentile) experienced significantly higher income growth (30 percent) than in the state overall (16 percent increase).
Drivers of Inequity
The Bay Area is an economic powerhouse at the epicenter of the digital revolution, yet this robust economic growth is not being broadly shared. Mirroring national trends, our regional economy is increasingly polarized between high-wage, knowledge-economy jobs and low-wage service sector jobs, while the middle-wage jobs that have typically served as stepping stones into the middle class for workers without college degrees are disappearing. Income inequality has increased dramatically in the Bay Area since 1980 as high-wage workers have seen tremendous income gains but other workers’ wages have stagnated or declined. Racial and gender inequity is baked in to uneven income growth as well since workers of color and female workers are segregated into the lowest-paid occupations and sectors.
Strategies
Invest in people: Strategies to foster economic security for all
- Raise the floor on low wage work by increasing the minimum wage or enacting living-wage laws, requiring paid sick days, ending wage theft, strengthening workers’ rights to organize, and ensuring fair scheduling
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Target economic development and workforce efforts to grow high-opportunity sectors that provide pathways for people without four-year degrees
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Ensure entrepreneurs of color can access the capital and know-how to launch and expand their businesses
- Leverage anchor institutions to support local and minority-owned businesses
Strategy in Action
Minimum wage in California will reach $15/hour by 2023, but localities are doing more now. In 2016, California legislators passed Senate Bill 3 that will increase the state’s minimum wage by $1/hour each year until it reaches $15/hour. As of 2020, 21 cities in the Bay Area, such as Berkeley, San Francisco, Milpitas, and Palo Alto, have a higher minimum wage than the state. And many more will continue to increase their minimum wages in the coming years. Learn more.
Photo: Fibonacci Blue/Flickr
In Their Own Words...
“ While I’m in this program I’m going to learn all I can, be the best I can, and earn as many state certifications as possible.”
After serving an eight-year prison sentence, Michael was looking for an opportunity to become a commercial electrician. He learned about Working Partnership’s Trades Orientation Program at a reentry center, and immediately signed up for the program which helped him get a three-year apprenticeship as a low-voltage electrical apprentice. He is now earning a living wage with full health benefits and a pension, and may continue on to become a commercial electrician when he is finished.
Photo: Felix Uribe
