“A snapshot of San Jose’s rising cost of living, as illustrated by increases the city’s living wage standards. The city measured a nearly 13 percent jump during 2013 — the biggest year-over-year increase on record — far outpacing even the city’s $2 minimum wage increase to $10 an hour during 2013.”

It is 87% more expensive to live in the Valley than the average American city. It is a community of the very rich and the very poor—the middle class cannot afford the price of housing, food or amenities.  To some it is an incentive to work harder and succeed.  To others, it is an opportunity to oppose those greedy successful people that worked hard and are creative.

It does prove you can’t make people rich by artificially increasing their wages or even the minimum wage.  When you do, prices will go up and ending poverty will still be out of their reach, by about the same amount.

111011-money-sm

 

Record cost-of-living increase makes Silicon Valley 87% more expensive than U.S. average

A snapshot of San Jose’s rising cost of living, as illustrated by increases the city’s living wage standards. The city measured a nearly 13 percent jump during 2013 — the biggest year-over-year increase on record — far outpacing even the city’s $2 minimum wage increase to $10 an hour during 2013.

Lauren Hepler, Silicon Valley Business Journal, 3/3/14

It’s not your imagination; it really is 87 percent more expensive to live in the heart of Silicon Valley than elsewhere in the U.S.

That cost differential, which jumped nearly 20 percent last year alone, is forcing the City of San Jose to make a record wage increase for public workers.

The city will pay its workers and contractors with health benefits $17.81 per hour, or $19.06 per hour for those without benefits starting July 2014, according to new annual living wage guidelines. The new living wage numbers reflect a 12.9 percent year-over-year increase in San Jose’s cost of living — the biggest annual jump on record and three times the average 4.3 percent yearly increase since 1998.

The city’s minimum wage for all workers — as opposed to the living wage required for workers doing business with the city — is just over $10 an hour following a voter-approved increase from $8 an hour in early 2013.

San Jose’s living wage increase was driven primarily by housing cost increases not seen since the dot-com boom. Concerns about high housing costs and Silicon Valley’s rising cost of living also dovetail with broader debates about the sustainability of the region’s widening income gap.

The new living wage guidelines were calculated by adapting federal wage standards to San Jose’s economic climate.

Nationwide, the poverty line rose by about $260 for a family of three during 2013, and Silicon Valley’s cost differential, also known as the geographic adjustment factor, increased more than 19 percent last year. All told, it now costs 87.3 percent more to live in San Jose than the national average.

“The increase in the geographic factor is the primary result of increasing rental housing costs,” according to a city statement on the living wage. “In 2013, the average monthly rent for a one bedroom, one bath apartment in San Jose was $1,825.”

 

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