In Chicago, Your Real Income Doesn’t Go Very Far; But Check Out Danville
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By John Dodge
CHICAGO (CBS) — In Chicago, how much is your income really worth?
NPR put together a graphic that shows the annual income for typical, full-time workers in different metro areas and adjusts that figure for the cost of living.
In Chicago, the median income, according to the Bureau Of Economic Analysis, is $32,491.
When the area’s relatively high cost of living is factored into the equation, the true value of that income is only $28,907.
Residents of Danville get the most bang for their buck.
The cost of living there is much lower.
A $30,000 income in Danville is actually worth nearly $36,000 due to the town’s low cost of living. In fact, the BEA says Danville has the best “regional price parity” in the country.
The regional price parity measures the differences in the price levels of goods and services across states and metropolitan areas for a given year. RPPs are expressed as a percentage of the overall national price level for each year.
That means that Danville is one of the least-expensive cities to live in the country.
For the entire state, Illinois is slightly more expensive when compared with overall national prices.
Washington D.C. is considered the most expensive place to live by this measure. A median income of $44,000 there is actually worth only $35,000.
To determine how far your income goes, divide your income by the RPP.
In Illinois, it would be (income)/(1.006). In Indiana it would be (income).(.911)
So the real “value” of an $80,000 job in Illinois would be $79,500. In Indiana it would be almost $88,000.
Of course, the RPP varies by municipality. So, generally speaking a buck goes farther in some states than others.
The graphic below shows the RPP for each state and Washington, D.C. The lower states on the list are the least expensive.
Obviously, there are other factors involved, such as your quality of life, the fact that your career may require you to live in a certain place, and taxes.