According to a report released last month, Los Angeles County is expected to gain nearly 133,000 jobs between 2016 and 2021, but it also shows that inflation adjusted household incomes are 4.5 percent below where they were in 1990. The report was created by the Los Angeles County Economic Development Corp. (LAEDC) and it was presented at an event about housing held last month by the Southern California Association of Governments. The report notes that household incomes have actually risen steadily for the past 25 years, from $34,965 in 1990 to $61,338 in 2016. However, factoring in inflation shows that they’re down 4.5 percent below the 1990 level. This has unfortunately eroded the purchasing power of L.A. County residents for two decades. Economist Somjita Mitra, director of the LAEDC’s Institute of Applied Economics, stated,
I think we all realize that money doesn’t go as far as it used to. Rents and housing prices have increased, many consumer goods are more expensive and health care costs have risen. People have to allocate their money in different ways. You might not be able to save as much or you might not travel as much as you used to.
High housing and rental costs and a shortage of available homes have long hampered Southern California’s economic momentum. The median price for a new home in 2016 in L.A. County was s $583,807, which is higher than the 2007 pre-recession peak of $537,011. Education is also linked to lower household incomes and the report notes that the median annual income for county residents with just a high school diploma was $27,330 last year, while the median for those with a bachelor’s degree was $52,003. The good thing is that L.A. County employment is projected to grow at an average annual rate of 0.7 percent over the next five years, which will help decrease the poverty rate. It’s really interesting to see that even though the number of available jobs is going up, the purchasing power of salaries is being diminished.