”Survey says” looks at various rankings and scorecards judging geographic locations while noting these grades are best seen as a mix of artful interpretation and data.
Buzz: The pay gap between California’s upper and lower halves of the pay scale is larger than any other state.
Source: My trusty spreadsheet looked at some federal jobs data for May 2023, tracking two noteworthy slices of wages by state – the 75th and 25th percentiles, or the medians of the top half and bottom half of salaries. This spread offers clues about uneven paychecks across a state.
Topline
There’s a 146% difference between what California bosses typically paid in the top half of salaries versus the bottom half. That’s the No. 1 chasm among the states and well above 108% nationally.
After California came Massachusetts and New York at 144%, then Maryland at 142%. The smallest gap was in Maine at 81%, then South Dakota at 82%, Iowa at 84%, and North Dakota at 85%.
And this measure of income inequality in California’s two big economic rivals? Texas ranked No. 8 at 128% and Florida was No. 32 at 100%.
The details
How did we get to this gap?
Well, California homes still sell (slowly), our roads are filled with new vehicles, and our shopping centers are busy because many bosses in the Golden State pay really well.
The state’s 75th percentile pay – the mid-point of the upper half – ranked No. 3 in the U.S. at $93,250 a year. Nationally, that pay is $70,035. So Golden State bosses pay 33% better for the higher-pay work.
Topping California were Massachusetts at $98,110 and Washington at $95,180. The lowest was Mississippi at $55,870, Arkansas at $58,900, and South Dakota at $59,980.
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By the way, Texas was No. 22 at $72,640 and Florida, No. 30 at $67,600.
Yet, many California jobs don’t pay well – thus the huge have-versus-have-not divide.
Wages at the 25th percentile – mid-point of the lower half – in California ranked No. 7 at $37,890 vs. $35,030 nationally. So, for the lower-salaries worker, Golden State bosses pay only 8% better than US peers.
Tops? Washington at $43,370, Massachusetts at $40,130, and Colorado at $38,830. Lows? Mississippi at $27,910, Louisiana at $28,900, and West Virginia at $29,260.
And Texas was No. 41 at $31,920 and Florida, No. 32 at $33,730.
Bottom line
Whenever you wonder who can afford California, don’t forget that some people can – as this math shows.
However, while California pay level for the upper half may seem generous – it does not go very far in the Golden State. For example, ponder those paychecks as fuel for house hunting.
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The California Association of Realtors estimated buyers needed a $208,000 household income to qualify to buy the median priced home in the spring of 2023 – when this wage data was tabulated.
That’s more than double the 75th percentile wage. Yes, a household with two jobs paying more than what three-quarters of Californians make doesn’t cut it.
And that why’s the Realtors math says only 16% of households could “afford” to buy.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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