California News

Despite California’s Immense Wealth, The Middle Class Is In Decline

Mercury News California’s lush coastline, balmy climate and post-World War II economic promise made it an easy sell as America’s middle class paradise in the 1950s.

“The California Dream of two or three generations ago was, `I’m going to move from a place that’s cold and flat to a place where there’s lots of opportunity,’ ” said Joel Kotkin, a presidential fellow in Urban Futures at Chapman University in Orange. “`I’ll get a job in an aerospace factory, in an oil company. I’ll buy a house with a pool. I’ll die and go to heaven. And I’ll do it all in good weather.’”

Today the weather remains. But access to the California dream is being choked off.

Stratospheric housing costs, the exit of key companies and the failure to replace the jobs that left with them have downsized the state’s middle class. Today, the nonprofit CALMatters — in partnership with news organizations around the state — is examining that phenomenon as part of an occasional series exploring the decades-old promise and current-day reality of the California Dream.

Since 1970, California’s share of the middle class fell from 60 percent to just over half the population, according to the Pew Research Center. The trend is similar around the country as well-paying manufacturing jobs give way to lower-paid service employment, but it has a particular twist here:

In California, some have risen to the upper class, others have slid down. And some have left the state.

“The key group leaving is basically in their 30s, 40s and 50s tending to be making about $100,000 to $200,000 a year,” Kotkin said, citing Internal Revenue Service data.

Between 2007 and 2016, California lost 1 million more domestic residents than have come into the state, according to the IRS. Many are moving to Texas, Arizona, Nevada and Oregon.

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