According to research from Pew Research Center, Silicon Valley has a high cost of living, but even after adjusting for this still has the highest wages in the country.
The average weekly wage in the San Jose-Sunnyvale-Santa Clara, Calif., area is $1,706, after adjusting for the area’s cost of living. That’s far higher than any other city in the country. California-Lexington Park, in Maryland, comes second, with $1,277. San Francisco-Oakland-Hayward, Calif., is third, but the high-wage areas aren’t concentrated in California. Seattle-Tacoma-Bellevue, Wash., Huntsville, Ala., and Midland, Texas all rank in the top 10.
The low-wage end of the spectrum, after adjusting for the cost of living, also crisscrosses the country: Yakima, Wash., Punta Gorda, Fla., and Jacksonville, N.C. are all in the bottom 10. The lowest adjusted weekly wage is in Ocean City, N.J., at $590 a week. That’s $65 less per week than the second-lowest city, St. George, Utah.
Being average and living in the right place can make a big difference: extended over the course of a year, the average annual wage in San Jose is $58,000 higher than in Ocean City. Even the difference between San Jose and California-Lexington Park would be $22,308 a year.
Pew Senior Writer Drew DeSilver explains why the cost of living adjustment matters so much to wages. “High regional price levels can erode the real value of wages, but relatively low prices can effectively offset low wages, at least to some extent,” DeSilver writes. “In Beckley, West Virginia, for instance, the average weekly wage is among the lowest in the nation ($707), but the metro area also has the lowest cost of living; as a result, the adjusted average weekly wage is 28 percent above the actual wage. The biggest negative differential is in Honolulu, which has the highest regional price level of any metro area in the country and an average weekly wage ($932) that’s somewhat lower than the national average. When adjusted for the local cost of living, Honolulu’s average wage shrinks by more than 18%, to $761.”
Jason Russell is a commentary writer for the Washington Examiner.
