MONEY, IT’S A HIT
If you’ve ever had the misfortune of sitting down to assess your personal budget, you know the pain of debating if living costs in your area are worth it compared to your income. Generally, the cities with the highest income are also paired with higher living costs.
San Jose, San Francisco, Washington, DC, Fairfield County, CT, and New York are America’s five metros with the highest salaries, and also some of the most expensive places to live. Is it worth getting paid more if you also end up paying more? Can’t there be some mystical region with low cost of living where you can also rake in a sizable paycheck?
Luckily for those of us too lazy to use Google or math, the nice folks at Indeed drew up a list of Cities Where a Paycheck Goes the Furthest in 2017. Using salary data from August 2016 to July 2017, they calculated an average of all jobs with annual salary information for each of the 104 US metropolitan areas with at least 500,000 residents.
After adjusting for each metro’s cost of living and considering unadjusted average salaries based on fixed-effects regression model, Indeed ended up with some helpful comparisons.
WHAT THEY FOUND
Check out if your city made the list.
HIGH AND LOW
After adjusting for cost of living, coastal metro areas with high salaries aren’t such a great deal. None of the big coastal metros ranked in the Top 20 list of affordability, but tinier metros in the South and Midwest made it. In fact the only California metros on the list are from the Pacific region, where housing is significantly less expensive than the coast.
Indeed notes, “adjusted salaries are higher outside the largest metros. Even though you’ll see more money on your paystubs in bigger metros than in smaller metros, those big-city salaries are outweighed by an even higher cost of living.” The highest adjusted salaries where your paycheck spreads the furthest are in Birmingham, AL, Jackson, MS, and Fresno, CA.
Honolulu, Hawaii topped the list for where salaries stretch the least.
Although housing costs are lower in Honolulu than San Francisco and San Jose, physical goods must be shipped to Hawaii, and their adjusted salaries are among the lowest in the country.
MOVING ON UP
So why doesn’t everyone just move to where the cities on the top 20 list? Because moving is money, and uprooting your life and job can be a huge ordeal if you have family and friends in your area. Job security is another factor to consider. Although one area may have a higher adjusted income, it could be riskier to make the move if the job market is less stable.
Indeed also points out that some places are desirable locations even if they’re not so easy on your wallet (aloha, Hawaii.) Plus, in areas high in routine jobs, the threat of automation/robot takeover is very real. Check out Indeed’s blog post for more info on their methodology and fun charts.