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Wages not meeting cost of living


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POSTED: Friday, December 11, 2009

The average weekly wage in Honolulu, which rose 0.4 percent to $801 in the first quarter from the same period a year ago, is not keeping up with the cost of living or the national average.

It costs about 66.5 percent more to live in Honolulu than the nation as a whole, according to the Council for Community and Economic Research's (C2ER) latest cost of living index. Yet, yesterday's estimate from U.S. Department of Labor's Bureau of Labor Statistics (BLS) indicated that Honolulu's average weekly wage was about 9 percent below the national average, which dropped 2.5 percent to $882.

C2ER, which has been measuring the cost of living for more than 40 years, pegged Honolulu as the third most expensive urban area behind New York and Brooklyn, N.Y.

               

     

 

PRICE OF PARADISE

        The Council for Community and Economic Research's latest cost-of-living index pegged Honolulu as the third most expensive urban area and estimated its cost of living at 66.5 percent higher than the national average. However, Honolulu's average weekly wage failed to keep par with wages in almost all other high-cost areas and was about 9 percent lower than the national average, according to data released yesterday by the Bureau of Labor Statistics.
       

 

       

       

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
10 most expensive Cost of Weekly wage in
urban areasliving indexQ1 2009
New York214.7$2,149
Brooklyn, N.Y.177.2$725
Honolulu166.5$801
San Francisco162.9$1,523
Queens, N.Y.156.3$828
San Jose, Calif.153.1$1,519
Orange County, Calif.146.7$992
Nassau County, N.Y.144.9$962
Truckee-Nevada County, Calif.144.4*
Stamford, Conn.143.1$1,735
National average100.0$882

       

*This region was not large enough to be included in the BLS' report of the nation's 335 largest counties.

       

Source: BLS; C2ER

       

 

       

       

“;Honolulu is always in our top 10 list of the most expensive cities,”; said Dean Frutiger, Cost of Living Index (COLI) project manager for C2ER. “;New York is usually the most expensive, and then it's a toss between San Francisco and Honolulu for No. 2.”;

In general, it costs significantly more for housing, utilities, grocery items, transportation, health care and miscellaneous goods and services in Honolulu than in other urban areas, Frutiger said. Honolulu also had the dubious distinction of having the most expensive half-gallon of milk among all urban areas surveyed. The average price paid for a half-gallon of milk was $3.81 in Honolulu versus $1.31 in Tucson, Ariz., where milk was the cheapest.

As young parents, Honolulu residents Kawehi Helm and her husband, Curtis, understand the reality of these statistics.

“;Prices are always getting higher,”; Curtis Helm said.

The couple shop close to home to cut their transportation costs, and bring their own bags to Foodland so that they can save a nickel on their purchases.

“;We use coupons whenever we can to purchase baby food, formula and diapers,”; Kawehi Helm said.

But even with the savings, the Helms—like all Honolulu residents—to some extent must do more with less. While Honolulu's most recent weekly wage estimate puts it in the top half of the 334 largest counties tracked by BLS, the region's weekly wages have fallen below the national average for most of the decade, said David Kong, a California-based BLS statistician.

“;Honolulu ranked 159 out of the 334 counties that we measured, and it ranked 96th nationally in terms of wage growth,”; Kong said. “;However, going all the way back to 2001 and maybe longer, Honolulu's wages have been lower than the national average.”;

Honolulu's limited mix of jobs, along with the downturn in the state's visitor industry, is to blame, Kong said.

“;Most of your jobs are in the hospitality sector, and while those workers are fairly high paid for their jobs, they tend to make less overall than workers in other fields,”; he said.

Despite suffering the nation's largest weekly job losses, New York City held the top average weekly wage of $2,149. San Mateo, Calif., which boasted an average weekly wage of $1,786, was second in the nation, followed by Fairfield, Conn., at $1,735.

“;Certainly these labor markets are much more diversified than Honolulu's,”; Kong said.