Growth Amid Dysfunction: An Analysis of Trends in Housing, Migration, and Employment

Published: 2018 | F. Noel Perry, Colleen Kredell, Marcia E. Perry, Stephanie Leonard

Abstract

Wages have increased and employment opportunities – especially in the Bay Area’s booming tech sector – are attracting migrants from other states and countries. But a strong economy can also be dysfunctional, and not all Californians are benefitting. The state is experiencing shifting population dynamics driven by high housing costs and changes in the employment make-up of California residents. While low-wage jobs have grown more in California than in most other states, incomes for lowwage Californians have not risen on a parallel path to incomes in middle and high-wage industries in the state. The average take-home pay of a low-income earner in California isn’t that far off from that of a low-income earner in other U.S. states, yet the cost of living in California is much higher. As the Golden State continues to draw more high-earning, educated migrants from other states and countries, housing development to meet the growing need is far behind. The result is an ever-increasing cost of living as low-income wages stagnate, forcing lower- and middle-income Californians to leave the state in hopes of finding more affordable housing.