By Khalida Sarwari
The city of Saratoga has the fastest-strengthening middle class in the Bay Area, according to a new report.
The city came in 11th on a list of the top 100 cities where the middle class is growing the fastest, a NerdWallet report found.
To identify where the middle 60 percent of earning households increased the most, NerdWallet analyst Sreekar Jasthi analyzed data from the U.S. Census Bureau that measured housing costs and growth in the average household income for more than 2,000 U.S. cities between 2007 and 2013.
Jasthi’s report, released May 4, revealed that most of the growth in this segment is happening in small cities. Saratoga is the only city in the Bay Area and one of seven in California that made the list. Not surprisingly, the report found that Saratoga’s middle class earns much more than the national average–in fact, almost three times as much.
“Places like Saratoga–being where it is near San Jose, Cupertino and all that–it’s the proximity to a lot of growth in terms of tech and business; it’s a suburb where families live, and a lot of them work in these sectors,” said Jasthi. “That has contributed to a rise in incomes overall in Saratoga.”
Between 2007 and 2013, the city saw a nearly 28 percent growth in the average middle class household income, according to Jasthi. Furthermore, the middle class share of total household income in Saratoga jumped from under 45 percent in 2007 to nearly 50 percent in 2013.
“That is in itself a strong sign of the strengthening middle class in Saratoga,” said Jasthi.
He noted that as long as leading industries such as technology are thriving, cities such as Saratoga will continue to see a strengthening middle class.
Big Spring, Texas, with a population of a little less than 28,000, came first in the rankings.
In comparison, the average middle class income in large cities is about $52,194–16 percent lower than the average household income of $62,150 earned by the middle class in smaller cities.
“These figures reflect a narrative that has long existed, that suburbia is a friendlier place for the middle class than large urban centers,” states the report.
This is the first time NerdWallet, a San Francisco-based personal financial services website, conducted this study. In March, Saratoga ranked fourth in NerdWallet’s list of highest-earning cities. According to that study, 44.6 percent of residents in Saratoga make more than $200,000 a year.
To view the complete list of the cities with the fastest-growing middle classes, visitbit.ly/nerdwalletcities.
Link: Report ranks Saratoga’s middle class growth among area’s best
