The "Real" Cost of Living in NJ...

So, as part of a "webquest" our professor assigned, we were assigned to read an article on the "Real" Cost of Living in New Jersey. Let's face it, the federal standards of poverty, very poor, poor, etc. are not very useful in most cases. It is very easy to make enough money to be far over the federal poverty cap, yet still have difficulty making ends meet.


This article presents a different, and I feel more accurate, take on cost of living. First of all, it takes into account more than just food. If you didn't know, federal poverty guidlines are based on the assumption that food equals one third of the budget. Multiply that by 3 and you have the federal poverty level income. Easy? Yes. Accurate? Not so much.


Another thing I really liked about the article was it took childcare into account when considering cost of living. As a father of a child who just started school and another who will be starting life in a couple months, I was gratified to see something that acknowledged how huge an expenditure child care can be. Before our son started school childcare was probably our #2 cost each month, behind housing. And that was with just one child.


There are some things about the article I didn't like. One big thing was the articles tendency to focus on "one parent, one school-age child and one preschool age child" as their typical family unit. Maybe it's just me, but that doesn't stirke me as the "normal" household, despite the articles claims that it was the more useful measure. It isn't my household, nor is it the household of anyone I know, off the top of my head.


Another thing I disliked about the article was their use of medians and average values in their calculations. Especially for housing. I think median housing costs can be easily and severely skewed by small ammounts of highly affluent housing. Say you have an area with 90% cheap housing but one area (10%) of ultra-affluent mansions (ever been to Glen Ridge? Just kidding, they don't have cheap housing). The average housing cost would come out much higher than the "norm" and you could conclude that most people in that area didn't have the income to live there, when it reality there was plenty of housing that fit their budgets. And NJ certainly has a good chunk of highly affluent housing areas, much more it seems than other parts of the country I've lived.

To put it another way, I know many young people in Essex County (single, no kids) who don't make anywhere near what this report says they should be making in order to meet the cost of living (they would have perhaps 50% wage adequacy, according to this report). But they get by just fine. They do have economic difficulties, but they don't have major issues covering the necessities of life. And totally without government support, I might add.


So I struggle with the validity of the data and conclusions in this report, based on my own experiences. I do think the guidlines set forth in this report are an improvement over standard federal guidlines, but I still don't know that they're a truly accurate measure of the "real" cost of living. I'd expand, but I'm making an effort to shorten my posts enough so that they don't resemble "War and Peace" any more.