In our previous blog post, we reported that inflation was higher in the New York City area than in the Cleveland area. Today, we look at their local incomes to see if the same conditions apply. The top graph shows personal income per capita for these areas. It’s not possible to get a perfect geographic match, but we use Cuyahoga County to represent the Cleveland consolidated metropolitan statistical area and a broader area around New York City (but without the western Connecticut towns used in the previous post). Without forgetting these mismatches, we see that overall income growth seems to be similar in both areas, except for the bubble in NYC just before the previous recession. So it doesn’t look like New Yorkers are compensated for their more-quickly-increasing living expenses.
The bottom graph reveals a similar exercise but with median household income, which is collected by county. Again, we use Cuyahoga County as a proxy for the Cleveland MSA. We use New York County to represent the NYC area.* The picture looks quite different, with Manhattan residents showing impressive income gains recently that probably aren’t matched in the wider New York metropolitan area.
*Admittedly, this is a restrictive choice; but piecing together data from the many surrounding counties is beyond the scope of this post. Readers are always encouraged to browse through FRED’s data aisles to find the best data to meet their needs.
How these graphs were created: Search for “personal income per capita Cleveland” and Cuyahoga County should be near the top. From the “Edit Graph” button, add a line searching for “personal income per capita New York.” For both lines, change units to “100 for selected date” using 1984-01-01 to match the data of the previous blog post. For the second graph, search for “median income Cleveland” then add the second line by searching for “median income New York county.”
Suggested by Christian Zimmermann.