Rising wages and income equity for all genders and races raises the standard of living for workers, which can further accelerate economic growth. The poverty rate is low and support services help those most in need.
Income and Wages
Median household income is one way to measure income of residents in the county: half of households earn more than the median income and half earn less. It’s considered a more reliable indicator than the average income because it is less likely to be skewed by outlier data, such as unusually high or low incomes.
- San Mateo County’s median household income rose 4% in 2017, the same amount of increase from 2015 to 2016.
- California saw a rise in median household income of approximately 3% in 2017, while the national median income only increased by 1% after adjusting for inflation.
- The distribution of income in San Mateo County changed considerably from 2007 to 2017. In 2007, 59% of county households had income under $99,000; by 2017, this percentage decreased to 44%.
- Though the increase in higher incomes is considered positive, it likely indicates that low-income residents have been displaced.
Over the past four years the county median household income has increased by over 20%, shifting the definition of middle-income wages. Income disparity persists as many residents struggle to meet their needs, but earn too much to qualify for government assistance based on the Federal Poverty Level (FPL) or the state poverty rate. Shown below is the median household income distribution and the income limits for several federal and state run safety net benefits.
- In response to the high cost of living, several government agencies increased the income limits for safety net programs in 2017, including federal housing assistance and state child care subsidies.
- A variety of local nonprofit organizations have stepped-up efforts to alleviate the pressure on household budgets while providing services to an increasing number of clients.
Average Weekly Wages
Average weekly wages track wages paid by employers in San Mateo County and include other compensation such as stock options and bonuses. Unlike median household income, average weekly wage data are more likely to be skewed by unusually large or small values.
- Average weekly wages grew by 31% in 2012, reaching a record high of $2,057, driven by increased wages in the Financial Activities and Professional and Business Services industry segments.
- The average wages for several types of service jobs are listed below (monthly/annually). For many, the median asked rent ($2,684 for a 1 bedroom and $3,318 for a 2 bedroom) is half a month’s wage.
- Chefs and Head Cooks: $4,451 / $53,412
- Computer Programmers: $8,852 / $106,234
- Elementary School Teachers: $5,823 / $69,883
- Financial Analysts: $11,006 / $132,069
- Forest and Conservation Technicians: $3,190 / $38,805
- Legislators: $5,743 / $68,919
- Paramedics and EMTs: $4,695 / $56,336
- The Information sector includes all forms of publishing, broadcasting, telecommunications, and data processing industries. It has consistently produced the highest annual average weekly wages in the county since 2013. However, wages for this sector decreased by 26% in 2016 compared with the prior year.
- In 2016, the Financial sector experienced a 14% increase in annual weekly wages compared with 2015, the largest increase among the six sectors.
- Lagging wages in the Education and Health Services, Leisure and Hospitality, and Trade, Transportation and Utilities sectors contribute to rising income inequality within the county.
To address the increased cost of living in 2014, California raised its minimum wage from $8/hour to $9/hour, and increased again in 2016 to $10/hour. Meanwhile, San Francisco supervisors passed an ordinance to increase the minimum wage from $10.74 to $15/hour by 2018. In 2016, the San Mateo City Council increased the minimum wage within the city limits to $15 per hour. The ordinance will reach full implementation by 2019, with an extension for nonprofit organizations. At least 25% of low-wage workers in the city earn less than $15 per hour as of 2015. Beginning in 2020, the San Mateo City Council will adjust the minimum wage each year to match the cost of living in accordance with the Regional Consumer Price Index.
Employment and Unemployment
- In 2016, employment in the county rose by 2.9% compared to the previous year, a smaller increase compared to the growth in 2015, which showed a 3.2% gain.
- Employment surpassed 2000’s high of 387,000 in 2013 and continues an upward trend.
- The unemployment rate continued to decline at the county, state, and federal level for the fifth straight year since it peaked in 2010.
- The decrease in poverty in San Mateo County is due to an increase in median income and displacement of the working poor outside of the county (Urban Habitat).
- Between 2015 and 2016, most of the counties in the Bay Area experienced a decrease in poverty, with the exception of Napa and Santa Clara Counties.
- The San Mateo County poverty rate for families with children decreased by 7.6% between 2015 and 2016, and the poverty rate for single, female headed families decreased by 30%.
- The Federal Poverty Level (FPL) is the annual income required to meet basic needs. Adjusted annually for inflation, the FPL does not account for local variations in the cost of living and therefore underestimates the number of people living in poverty in expensive areas like San Mateo County.
Alternative Measure for Poverty
The Self-Sufficiency Standard (SSS) calculates the income required to meet basic needs (without public or private assistance). Unlike the FPL, it accounts for local costs of living such as housing, childcare, healthcare, and transportation. In 2014, the SSS for a family of four in San Mateo County required an annual income of $85,090 to meet basic needs without public or private assistance, considerably higher than the FPL of $23,850. The SSS annual income for the county is equivalent to two adults earning an hourly wage of $20.14. According to the Insight Center for Economic Development, 55,242 households in the county (29% of total households) had incomes below the Self-Sufficiency Standard, while nearly 42% of county households with children had income below the SSS.
California Economic Development Department, Quarterly Census of Employment and Wages. (2016). Retrieved from www.edd.ca.gov
U.S. Census Bureau, American Community Survey, 2015, 1-year estimates. Healthcare Insurance Coverage. Retrieved from: https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml