Worker wages have risen since the onset of the coronavirus pandemic. That's true for high, median and low-income workers, and for hourly and salaried workers alike. "It's labor shortages," says Sinem Buber, lead economist at ZipRecruiter. There aren't enough workers to fill certain roles, driving up the offers employers are willing to make.
When it comes to high-income earners, for example, those making salaries in the 95th percentile ― or those making more than 94% of salaried workers ― average earnings across the U.S. went from $299,301 per year in 2019 to $327,254 per year in 2021, according to new data tracking 26 million salaried workers across the U.S. from HR company ADP.
And depending on where you are in the country, you might've seen a greater wage hike than others.
ADP surveyed the 53 biggest metro areas in the U.S. (those with more than 1 million residents) to see where salaried workers saw the biggest wage gains. Here are the 10 metro areas with the greatest gains for high-income earners, including their percent gain and average annual salaries in 2019 and 2021.
San Francisco-Oakland-Hayward, California
Percent gain: 15.99%
2019 annual salary: $525,415
2021 annual salary: $609,447
New Orleans-Metairie, Louisiana
Percent gain: 16.42%
2019 annual salary: $208,149
2021 annual salary: $242,331
San Diego-Carlsbad, CA
Percent gain: 18.59%
2019 annual salary: $338,984
2021 annual salary: $402,000
Percent gain: 18.81%
2019 annual salary: $225,480
2021 annual salary: $267,901
Percent gain: 20.15%
2019 annual salary: $283,209
2021 annual salary: $340,280
Miami-Fort Lauderdale-West Palm Beach, Florida
Percent gain: 22.13%
2019 annual salary: $275,132
2021 annual salary: $336,020
Percent gain: 22.45%
2019 annual salary: $274,540
2021 annual salary: $336,187
Percent gain: 25.44%
2019 annual salary: $399,066
2021 annual salary: $500,570
Buffalo-Cheektowaga-Niagara Falls, New York
Percent gain: 25.71%
2019 annual salary: $235,691
2021 annual salary: $296,287
San Jose-Sunnyvale-Santa Clara, California
Percent gain: 27.87%
2019 annual salary: $541,438
2021 annual salary: $692,341
A few factors may be contributing to this part of the workforce's wage gains.
The U.S. brings in top talent from around the world to fill positions in fields like tech. But the pandemic halted or slowed many of these activities, "So the talent shortage we are seeing at the high end of the spectrum is also because of low international immigration," says Buber. There aren't as many people around to fill those coveted positions.
As a result, companies are competing for a smaller base of local talent and responding by offering them better packages. While this can include a higher salary, says Buber, often this includes hiring bonuses, which can get reflected in the ADP data. This could be the case in tech hubs like San Francisco and Seattle.
Many of these positions can also be done remotely. As a result, throughout the pandemic, people in the 95th percentile may have moved to cheaper cities, suburbs or states to get the most of their salaries.
"Their departures likely thinned the middle of the salary distribution," says Issi Romem, a fellow at the ADP Research Institute and co-author of the report, "shifting some high earners down the percentile chain and giving the 95th percentile spot to an even higher earner." This could be the case in historically expensive cities like San Francisco.
Conversely, it's possible those people moving out of expensive metros and into less expensive ones shifted the wage scales in the latter. While it seems like wages have hiked in the latter, in fact, there are simply more people making higher salaries there as a result of migration. This could be the case in some of the Californian suburbs highlighted above, says Buber.
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