March 16, 2014 by Omar Passons
A week ago I heard on the radio that a group had released a report called “Making ends Meet” about what was involved in, well, living, in San Diego. Since I live here, you’d think I already have some sense, but I’m outside the typical experience both because I have a household with two relatively high-wage earners and because we have no kids so I had no clue how expensive childcare is. And there’s that whole eating out a lot thing. Anyway, I wrote a post (here) and took a little survey of people on Facebook and Twitter and here’s what I found…
First, there are a few reasons I wanted to do this:
- A family of four is 200% above the federal poverty line at $47,700. That’s about $4,000 a month gross and probably like $2,694/month net (take-home pay calculator). More on this in a moment.
- In San Diego we are going to make choices about policies to help our region thrive, we ought to make those choices with a decent understanding of the impact on all of our neighbors.
- Paying less for stuff you need is a lot like making more money. Maybe we should be looking at policies that can lower cost burdens.
I found the take home pay calculator exercise really illuminating. If you’ve never done this, think about a popular profession in town that you think probably does ‘ok.’ Then put their salary through this calculator exercise and think about how the expenses and revenues work out for them. The surprise when Wife and I did this over breakfast for the $48K salary above is how low that really turns out to be.
With that, let’s talk about what I found. I should mention here that my friend Erik Bruvold, whose opinions I value and whose big old brain is good for producing some useful pointers, sent me more than a couple sources of real statistical data. You can find San Diego population data here, consumer spending information here and even San Diego labor market information here. None of those links are particularly easy to navigate, but fortunately there’s an awesome research wiz named Tina Ngo at the San Diego Workforce Partnership (a local organization that basically helps people either get trained on new jobs or just find available jobs). Her reports are much easier and you can find a whole bunch of them here. I don’t pretend my survey would stand up to statistical scrutiny, but nevertheless I did get several eye-opening results from the about 50 people who responded, including:
- About half of the people with childcare needs said the $1,000 – $2,300/month listed for childcare was about right.*
- Several people reported rents of $800/month or lower – all were roommate situations. Virtually everyone except a couple long-time homeowners said the housing cost was low (surprise!).
- One friend feeds her family of 8 for…wait for it…$700/month (yes, she cooks mostly from scratch even with kids, yes she works and yes I will be hitting her up to post recipes and other secrets)
- Virtually everyone said the food budget was about right if people only ate food they cooked at home.
- One major flaw in child care/the workforce is the failure of either employers or childcare providers (or both) to make work hours and childcare hours line up. I’m editorializing here, but I bet if women ran more companies (or men were primary caregivers) this would change in a hurry. I say market, schmarket on this one. The disconnect is absurd.
- Transportation costs seem to underestimate insurance and car payment costs for most people.
- The most common gas figure I got was $300/month. Only people who walked or had short commutes were lower.
In the San Diego region there are many conversations going on among decision makers about how to create more opportunity for more of our citizens. One reason that isn’t likely up for dispute to support improving opportunity is that the more people in a region who are succeeding the better everyone’s quality of life will be. Another reason that I tend to think we ought to pay attention to the issue is that people who work hard ought to have a reasonable shot to lead a decent life. The problem with this rationale, of course, is that the decision of what makes something a ‘decent’ life probably ought not be left up to me – or any of us for that matter. But here’s the big point so many people seem to miss: it doesn’t matter. Seriously, there are so many people—especially children—who lack meaningful opportunity to succeed that we could focus all our policy efforts there, make a ton of difference, and not need to figure out who gets to decide what a ‘decent’ life looks like.
There’s an interesting article here about what the author called San Diego’s “real poverty rate.” Above I was writing about what it might be like if you calculated take home pay for a given salary. The first page of this chart shows how many people in San Diego hold jobs (professional, blue collar and service) at various income levels. The numbers will surprise you.
I am leery about most attempts to create policy to address issues like the ones raised in the Making Ends Meet report. This I say as I sit in Sacramento, fresh off a trip to Track 7 Brewing (a local Sacramento craft brewer I was directed to by delicious San Diego craft brewer Societe Brewing Company), and preparing to encourage certain policy decisions at the Capitol tomorrow. Nevertheless, policies will get made whether I support them or not so I figure it’s worth taking a shot, right? Plus, having recently met with several of our local legislators, I absolutely believe they are relying on research for their decision making. Here are a few ideas to consider – after considerably more research – that might make San Diego a better place for more of its residents and increase overall economic activity.
- Might we consider the positive economic impact of means-tested subsidy of private childcare? More people could be productive for more of the day, which seems like a potential net positive.
- Perhaps we should actively consider regulatory holidays to get certain large employers to site within communities where their employees reside. OR
- Perhaps the regulatory holiday needs to be for multi-family residential properties near existing job centers to increase housing supply and decrease the cost of that housing. This would also cut the transportation cost for those residents.
- I have no idea how to deal with our drought, but it’s worth mentioning that more people means more water use, doesn’t it?
Thanks for reading, I’d love to hear any feedback and please share any data you have.