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You do not even need a racial explanation for cities like LA losing population - The average rent cost of rent is less than the average pre-tax salary. This gna
by JohnMakin 2y ago
You do not even need a racial explanation for cities like LA losing population - The average rent cost of rent is less than the average pre-tax salary. This gnarly rent to income ratio is a trend across most major US cities. You simply cannot afford to live in them without a high paying salary. In LA, many of those people are fleeing inland, causing prices to increase there as well. It's a problem I'm not sure the solution for.
- 2OEH8eoCRo0 2y agoI blame a tech bubble. The salaries in these cities are massively inflated and it's messing up local economies in strange ways.
- bobthepanda 2y agoTech is not present in every city in the US. Really the big issue is lack of housing production, which was significantly lower in the 2010s and we still have not made up for all that lost time: https://fred.stlouisfed.org/series/HOUST https://fred.stlouisfed.org/series/HOUST
- blackhawkC17 2y agoI wonder why tech employees (labour) earning high salaries should represent a problem. That's a very good thing.
- Arnt 2y agoThe somewhat informed argument is that a few per cent of well-paying renters drive up the marginal price, and landlords try to stay close to the marginal rate.
- llamaimperative 2y agoYou'd intuitively think this is true, but empirically it has not been true anywhere ever. Rising productivity yields rising inequality. The issue is that land rents rise to swallow all productivity gains (we end up calling this "cost of living," as if it emerges out of the ether). That's why in ultra-high productivity locales like Palo Alto, $200k/yr is a welfare wage. The land is ludicrously expensive because those prices rise in lockstep with productivity -- which they don't have to. Land costs nothing to exist. It is there ready to be used no matter what the price is. But everything on the land, which is everything, must then pay rent to the landowners, giving rise to "cost of living." You can disprove this by showing me a location with high productive power and low land prices, or a location with low productive power and very high land costs (that's not abandoned or a vacation spot for highly productive people).
- nullc 2y agoHow does that cause a population decrease? "It's too expensive, no one lives there anymore"?
- JohnMakin 2y agoPeople leaving the city for less expensive areas
- moneil971 2y agoThis is about the U.S. as a whole tho. I don’t think people are leaving the U.S. entirely
- JohnMakin 2y agoThere is a table that shows the cities with biggest population loss, which is what I am referencing.
- vlovich123 2y agoThat explains migration within a country which doesn’t change population counts. Unless you’re claiming that white people are moving out of America because it’s too expensive and simultaneously Hispanics are moving into a higher COL area (even if not high COL cities, America as a whole is going to be higher COL than Latin America). Based on the news I’ve been following, a more likely explanation is that Biden’s immigration policy has been more welcoming on the southern border at the same time as Latin America destabilizing quite a bit politically and generating a lot of refugee migration. I just don’t see how high COL or lack of housing being built explains the population growth being dominated by Hispanics.
- JohnMakin 2y agothat is sort of my entire point, pointing to California’s massive population loss is completely irrelevant data for the topic of this article. I don’t have the data in front of me, but I would be willing to bet a large percentage of that is not due to birth rates and is due to emigration.
- georgeplusplus 2y agoHas limiting the amount of asylum seekers or people coming over the border to claim asylum crossed your mind?
- llamaimperative 2y agoConsidering that we already don't have enough workers, no. Has building more housing crossed your mind?
- lp0_on_fire 2y agoCome on. We’ve got plenty of workers in this country. They’re just not willing to work for pennies (and why should they?) Importing masses of unskilled labor puts downward pressure on wages. This is basic supply and demand.
- llamaimperative 2y ago> We’ve got plenty of workers in this country. Citation needed > They’re just not willing to work for pennies What jobs pay pennies? > This is basic supply and demand In a universe where more people in the country doesn't also increase demand, sure. That's not the universe we live in though.
- lp0_on_fire 2y agoLook at the unemployment numbers. “Pays Pennies” is a common English phrase that means “a job that doesn’t pay well”. I.e. jobs they pay at or slightly above the minimum wage. Why should native workers be displaced by those seeking asylum simply because the people seeking asylum are willing to work at OR BELOW minimum wage? I sympathize with their plight but to pretend that many of them aren’t economic migrants vs those who are actually fleeing imminent danger seems naive. And before the argument is made: I absolutely support crippling fines for those employers who KNOWINGLY hire under the table to skirt minimum wage laws.
- 2y ago
- llamaimperative 2y agoLand Value Tax
- JohnMakin 2y ago> The average rent cost of rent is less than the average pre-tax salary too late to edit now but other than the butchered sentence I meant the cost of rent is higher than the pre tax salary.
- ajross 2y agoCorrected wording or not, I think this is simply wrong. A quick Google tells me that median income in LA is $78k (sounds about right given the US household median is $60ish) and per Zillow average LA rent[1] is $2800, so about half that. One of the biggest problems with meme-driven economics like this (and HN is ground zero for this kind of logic) is the extent to which people just don't cite numbers anymore. There is some truth here: property values in high-income US cities are growing faster than incomes. And that's a problem, and worth discussing. But that discussion can't happen until people stop with the hyperbole. And needless to say, without discussion there can be no solution. (Which, after all, serves the evolutionary goal of the meme!) [1] Which surely reflects an average occupancy of 1.5-2 people, so needs to be adjusted even farther downward.
- JohnMakin 2y agoYou used the median, I used the mean. I think the latter is more useful here, but regardless, even using the median, that ratio is still god awful and not liveable.
- ajross 2y agoYou didn't cite numbers. But if anything the "mean" in a long tail signal like urban incomes is going to be much *higher* than the median, which cuts in my direction, not yours. But if you want to post numbers I'm happy to have the discussion I mentioned.
- JohnMakin 2y agoyou are right, I was looking at something outdated. However, I think the ratio is still bad enough that it doesn’t matter to my original point.