Direct efforts to relieve poverty via raising minimum wages, providing an earned income tax credit and expanding other public benefits certainly have marginal effects. But the latest reports indicate that in the long run, holding down costs for housing and other living costs, making education more available and effective, and encouraging private investment in more and better jobs are vital if California is to escape the ignominy of having the nation’s highest level of poverty.
While Storper, et al, compare Los Angeles to Detroit, there’s also another analogy. A century ago, Detroit was the Silicon Valley of its era, attracting enormous entrepreneurial talent and venture capital, and creating an entirely new industry — cars — that became global. But it took its dominance for granted, ignored its economic fundamentals and was devastated by leaner and meaner rivals.
The same fate could befall Silicon Valley if its traffic and housing problems continue to fester, encouraging the brains and the money to shift to more hospitable and lower-cost climes, particularly those in other states. Already, says Robert Kleinhenz of Beacon Economics, the Bay Area’s economic growth “is being constrained by a lack of affordable housing and a lack of skilled labor. These factors are having a disruptive effect on the job market.”
The L.A. metro area’s median base pay grew 0.5 percent in a one-year period through July 17 to $59,064, below the national average of 1.2 percent, according to a report from jobs website Glassdoor released Tuesday. The figures mark the slowest pace of wage growth in three years, indicating a continued slowdown in pay increases nationally, despite low unemployment and healthy jobs numbers, according to the report that is based on millions of anonymous salary reports shared on Glassdoor.
The U.S. entered the ninth year of economic expansion in steady but unspectacular fashion that shows little sign of abating.
Gross domestic product, a broad measure of goods and services produced in the U.S., expanded at a 2.6% annual rate in the second quarter, the Commerce Department said Friday, a rebound after a tepid start to the year.
The figures repeated a familiar pattern of weak winters followed by a stronger spring and summer, leaving overall growth subdued. “The economy is on cruise control. Unfortunately cruise control is about 2%,” said Diane Swonk, founder of DS Economics.
The U.S. emerged from recession in mid-2009. Since then, GDP growth has averaged 2.1%. In contrast, growth averaged 3.6% during a 10-year span in the 1990s and 4.9% during a nearly nine-year stretch in the 1960s, the only two expansions with longer durations.
The U.S. entered the ninth year of economic expansion on a familiar path of steady but unspectacular growth, with few obvious indications it is near exhausting itself. Gross domestic product, a broad measure of goods and services produced in the U.S., rose at a 2.6% annual rate in the April to June period, the Commerce Department said Friday. Figures are adjusted for inflation and seasonality.