The technology hub of San Francisco surpassed the nation’s capital last year as the highest-earning large U.S. metropolitan area. Median household income in the San Francisco metro area in 2016 was $96,667, just ahead of the $95,843 figure for the Washington region, the Census Bureau announced Thursday. That put the California hotspot in first place among the 25 most populous metro areas, with the capital falling to the No. 2 slot. The median income for the San Francisco area, including nearby cities such as Oakland and Berkeley, has surged in recent years amid a tech-sector boom and jumped 9.2% in 2016. Incomes in the Washington area, including parts of Maryland and northern Virginia, rose a more modest 2.7% from 2015.
The U.S. economy expanded at its most robust pace in more than two years in the spring and appears to have momentum going into the second half of the year, supported by solid consumer spending and a pickup in business investment.
Gross domestic product, a broad measure of the goods and services produced across the U.S., rose at a seasonally and inflation-adjusted annual rate of 3% in the second quarter, the Commerce Department said Wednesday. That was the strongest quarter in more than two years and some forecasters expect growth will remain around that pace in the third quarter.
The President has vowed to get economic growth back above 3% after the dreary slow recovery of the Obama “new normal.” What’s as sweet as the faster growth last quarter is the way it was achieved—with less spending by state and local governments but more consumer spending and rising business investment.
This last part is especially important. Lackluster business investment was a hallmark of the Obama era. And who could blame executives for being reluctant to pull the trigger on new plants and equipment? It was impossible to know what new intervention in the private economy regulators were dreaming up in Washington. When businesses don’t invest in new tools, workers have a hard time becoming more productive, which in turn means workers can’t demand higher pay.
U.S. worker productivity picked up modestly in the second quarter but showed little sign of breaking out of the sluggish trend that has prevailed for more than a decade, holding back economic growth and living standards. The lethargic pace of productivity growth seen in recent years could have a critical effect on the future trajectory of wages, prices, overall economic output and government budget balances. . . . “If labor productivity grows an average of 2% per year, average living standards for our children’s generation will be twice what we experienced,” Federal Reserve Vice Chairman Stanley Fischer said in a July speech. “If labor productivity grows an average of 1% per year, the difference is dramatic: Living standards will take two generations to double.”
Employers across the U.S. had a record 6.2 million job openings posted at the end of June, a sign that employers are hungry for new workers. The number of job openings climbed by 417,000 in June for private employers and by 44,000 for government postings, which include state and local government, according to the Labor Department’s Job Openings and Labor Turnover Survey, known as Jolts.