Bay Area wage growth slowing, but still among best in the nation
Bay Area workers saw their total compensation increase by 3 percent in March compared to a year before, slower than in March 2018.
Total compensation in the Bay Area — including salary, wages and benefits — increased by 3 percent in March compared to a year before.
That’s the fourth-largest rise among the 15 largest US metro areas, according to new quarterly data from the U.S. Bureau of Labor Statistics. But that increase is down from March 2018, when total compensation increased 4.4 percent compared to the prior year.
Russell Hancock, president of Joint Venture Silicon Valley, said he’s still bullish about the regional economy.
“My take is that the Bay Area is still in growth mode,” Hancock said. “It’s still happening.”
Technology companies are growing particularly fast, which is driving up competition, and wages, for high-skilled workers, he said. Companies are also having to keep an eye on things like rising home prices.
“There’s also a sense on the part of employers they have to pay more because our costs are more,” he said.
Joint Venture Silicon Valley found that average annual earnings in the Bay Area are double the national average, he said.
Total compensation increased 3.9 percent in the New York metro area, the fastest growth in the country according to the March data. That was followed by Los Angeles with 3.5 percent and Phoenix at 3.1 percent. The Seattle-Tacoma combined area was the only region that didn’t see an increase, declining 0.2 percent.
Wages and salaries alone increased by 3.3 percent in the San Jose-San Francisco-Oakland combined statistical area, which encompasses Marin and Santa Cruz counties. That was down from a 4.9 percent increase in March 2018.
Hancock said that while there’s not enough data yet to know whether a slowdown is imminent, he does believe one is inevitable.
“We seem to be in a funny in-between place right now where we figure out what’s next,” he said. That includes figuring out what impact AI will have on the labor market.