If you work four jobs like that you might be able to live in Fresno and commute on the back of a pick up truck to San Jose.
Just padmap 850/month. You can even get within walking distance. http://www.padmapper.com/# A lot of these listings include rooms within an apartment/house.
I don't think the GP is saying folks are working 4 full time (40 hours per week) jobs to get up to 120k per year. I'm pretty sure 8 hours of sleep a week isn't feasible.
1) The tax treatment on 1099s is worse than for W2s
2) You're basing this on working (and billing) 2000 hours a year. That's not remotely reasonable, because contractors often have to spend time finding new jobs.
Plus 2000 hours is grueling! That means a strict 2 weeks of vacation - no sick time, no Christmas, no nothing. This is not how a W2 worker is treated, and most W2 workers (especially knowledge workers) can't produce quality work for 8 hours per day, year-round.
2. I've worked many contracts, and I'm in one now. I expect to bill 2000 hours this year.
3. 2000 hours isn't grueling. I've done this much work a week in grocery retail and in IT, during the day and overnight, and it's easy. 2600 hours is rough. 3200 hours a year is grueling.
I know, "boohoo silicon valley problems" but that is a scary thought that $120k doesn't get you much of anything out here.
Based strictly on cost of living, my current salary would be just a hair under $126k/yr in SF, and I live quite comfortably. Better than most of my friends who aren't in tech. Housing, certainly the most expensive aspect of living in SF, is 233% higher than my current location. I could, if I wanted to, pay that right now on my non-SF salary, but only because I don't want to live in a giant house or a penthouse apartment.
If you were to spend 30% of your $126k a year salary on housing that's nearly $3,100 a month. You can find plenty[0] at that rate.
TLDR: I don't know what you're definition of "much of anything" is, but $120k is certainly enough for an upper-middle class lifestyle, even in SF.
But at the end of the day, everyone makes their own choices in life.
Positions which do not provide value > than the minimum wage will be eliminated, either because the roll they fulfill can be automated at that price point or its no longer worth while to the company.
There are, of course, marginal roles and not-very-profitable businesses where the value of an employee is pretty close to the minimum wage.
It in no way means all or most other companies can afford to do so.