D.C.'s High Wages Spent Elsewhere

People who work in the District make some of the highest wages in the United States -- on average, higher than those in San Francisco and the Boston area. But every night a significant proportion of those handsomely paid workers take their earnings back to homes and stores in the suburbs.

What that means for the District is a sort of fiscal bleeding, according to economists, as income taxes and most retail sales taxes paid by those commuters aren't contributed to the city where the wages were earned. The District's paradox can be seen by comparing the wages of people employed there and the household income of people who live there.

The average weekly wage for workers in the District was $1,300 in the second quarter of 2006, or $67,600 a year. Those who work in the District receive the nation's fourth-highest average weekly wage, according to recent data published by the Bureau of Labor Statistics. The top three: New York, Santa Clara, Calif., and Arlington.

But the median household income in the District was $47,221, close to the national median, according to a 2005 Census report.

In other jurisdictions, household income tends to be higher than the median wage because it can include income of more than one wage earner, as well as certain bonuses and other income.

That gap leaves the District with an imbalance that is growing worse, said Stephen S. Fuller, head of the George Mason University Center for Regional Analysis. "People have choices and want to buy homes with yards and good schools," he said. "If those workers are taking out their income tax and going home to do their shopping, there isn't much left behind for the District."

By comparison Fairfax County, where jobs pay the nation's ninth-highest wages of an average $62,868 a year, also has one of the nation's highest median household incomes -- $94,610.

Arlington County is experiencing some of the District's troubles with an outflow of workers residing elsewhere, according to Fuller, who analyzed commuter patterns. Fairfax, which has seen its economy boom in recent years, is also beginning to see more of its workers come from other parts of the region, he said. Yet unlike the District, the median household incomes of Arlington and Fairfax remain high because of their desirable schools and homes, he said.

-- Cecilia Kang