State’s median income up more than 3 percent
02/12/2014 12:00 AM
02/16/2014 9:12 AM
When it comes to income, the Bay Area rocks. In the Central Valley and Inland Empire, not so much.
Overall, in another sign that California’s economy is shaking off the recession, state tax officials reported Tuesday that the statewide median income – for 2012 – was $70,938, up 4.1 percent over the previous year. That’s for those filing joint tax returns. For individual returns, the 2012 median income was $35,910, an increase of 3.5 percent, according to the state Franchise Tax Board.
The highest median incomes were in the usual places: Marin, San Mateo and Santa Clara counties, which have topped the list for the last 40 years. But tech-centric San Francisco and Contra Costa counties are catching up, showing the biggest boost in median incomes from 2011 to 2012, up 7.7 and 6 percent, respectively.
Locally, Placer and El Dorado counties both ranked in the top 10, at seventh and eighth, respectively. Yolo was 11th and Sacramento ranked 19th.
The median income numbers for 2012, the FTB’s most recent data available, are the midpoint of reported incomes in all counties.
“California in general has been going very nicely since the end of the recession, even though it’s not as strong as we’d like it to be,” said Sung Won Sohn, an economist at California State University, Channel Islands. During 2012, he said, job gains were showing up in real estate, tourism, mortgage and banking, and in professional services, such as accounting and management consulting.
“Now, in 2014, we’re creating higher-paying construction, manufacturing and IT jobs. When you look at the overall picture, it’s a very encouraging one.”
Another factor boosting 2012 incomes: investment gains. That year, the combination of a robust stock market and uncertainty over 2013 tax hikes meant a number of Californians sold stocks late that year, boosting their annual incomes.
The amount of capital gains income – what Californians received from selling stocks or other investments at a profit – is estimated to have doubled between 2011 and 2012, said H.D. Palmer, spokesman for the state Department of Finance. In 2011, Californians reported $52.1 billion in capital gains income; a year later, it had jumped to $104.1 billion.
“It was one of the factors driving up adjusted gross incomes,” said Palmer. For 2013, capital gains income is expected to show “a modest decline,” to $87.5 billion.
Locally, counties like El Dorado, Placer and Yolo ranked well on median incomes, likely because they’re “upper-middle-class counties” with “not as many poor households and not as many millionaire households,” compared with other areas, said Jeffrey Michael, a regional economist with the University of the Pacific in Stockton. “They’re above the state average (in median income) and recovered a little better after the recession than Sacramento,” he said.
By comparison, Sacramento, which ranked in the top half for median incomes among California’s 58 counties, would show a wider income range in 2012, with more lower-wage households, less investment income and more state workers on reduced paychecks, he said.
Certainly, not everyone is seeing fatter paychecks and bigger investment rewards during the recent recovery.
“Unfortunately, it’s not uniform across the state,” said economist Sohn, who said two areas – the Central Valley and the Inland Empire – are lagging in income and employment rates. Because they were more reliant on agriculture and the housing boom, they have struggled to recover as fast as the state’s more urban areas, Sohn said.
“It’s good to talk about economic recovery, but it depends on where you are. The vast majority of Californians are benefiting,” he said, “but how well you are doing depends on where you are geographically ... and the industry you’re in.”
The complete list is available on the Franchise Tax Board website, www.ftb.ca.gov.
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