3.4.1    Median household income adjusted by cost of living

High costs affect the regional economy in many ways.  Companies are less likely to locate or expand in this region because they must pay their employees more.  Skilled workers are less likely to move to or stay in the region because of the lack of reasonably priced housing.  Furthermore, high costs are leaving little money for families to invest in education, job training or to improve their quality of life. The inability of companies to find enough workers with the right skills will severely constrain job growth in the region.

How are we doing? 

Metro Boston’s higher than average 2001 median household income of $52,792 is equivalent to $38,691 after cost of living adjustments are taken into account.   By comparison, Atlanta’s $51,948 median income becomes $53,171 after being adjusted by that region’s lower than average costs.

At $52,792, Boston has the 3rd highest median household income among comparable cities, with San Francisco at the top ($62,024) followed by Washington DC ($57,291).   After adjustments for cost of living, however, median household income equivalents translate to Atlanta in first place ($53,171), followed by Charlotte ($48,803), Hartford ($43.024) and Boston in 6th place ($38,961).

Bostonians spend more of their incomes on housing, including utilities, than the national average.  As a result the higher than average median income enjoyed by residents of Metro Boston does not translate into a higher standard of living.  In fact, the median income, after being adjusted for cost of living, is lower than the average of similar cities.