Even before the pandemic, a surprising percentage of Los Angeles residents lived in poverty, according to the new “LA’s Cost of Living Crisis" report from LA Controller Ron Galperin.
“Now, as high inflation impacts families and economic uncertainty lingers, the reality of soaring food, gas and housing prices is taking a toll on working families up and down the Golden State,” Galperin wrote in the introduction to a new cost-of-living story map on the city controller website.
In Los Angeles County, 14.2% of residents live below the federal poverty line, which in California is defined as having an annual income of $13,590 for a one-person household, $18,310 for two people and $27,750 for a family of four. Of the 1.4 million Angelenos living below the federal poverty line, 419,000 are children under the age of 18.
In Orange County, 10.1% of residents live below the federal poverty line compared with 15% in San Bernardino, 12.5% in Riverside and 8.9% in Ventura counties, according to the site’s map. Those numbers have likely increased during the past 2.5 years of the pandemic, Galperin said.
High inflation often worsens poverty and economic inequality, according to the Brookings Institution. That is precisely what is happening in LA, where the cost of basic necessities increased more than 20% between 2018 and 2021, according to the cost-of-living story map, with 56% of Native Americans, 56% of Latinx, 46% of Black and 32% of AAPI households struggling the most to meet basic needs in LA County — all of them at higher levels than the state average.
When the cost of basic goods continues to rise, it becomes almost impossible for lower wage households to thrive, the story map said. Food insecurity in particular has worsened since the pandemic.
So too has housing affordability. Three in four LA households report spending more than 30% of their income on rent and utilities, according to the University of Southern California Sol Price Center for Social Innovation. Monthly rents in the Los Angeles metropolitan area have increased 16% since 2019 to a median of $2,258, according to the U.S. Department of Housing and Urban Development.
With rent continuing to increase and inflation at 40-year highs, the city’s most vulnerable residents are becoming more housing insecure and at risk of homelessness.
Already, 44,000 Angelenos experienced homelessness in 2021, according to the latest available data from the Los Angeles Homeless Services Authority. Results from the 2022 count conducted earlier this year are expected to be worse when they are released in September.
To help LA’s lower-income residents, Galperin’s office encourages the building of more affordable housing and the creation of more high-paying jobs.
“It is imperative that incomes match the prices of rising essentials so that Californians can live more efficiently,” the report said. “That can only happen if more jobs are created where workers can have the ability to earn better wages.”
The report found that the minimum wage in LA lags the local cost of living. Despite a recent increase to $16.04 per hour, an adult working a minimum wage job in LA would have to put in 53 hours a week just to meet basic needs, while an adult with two young children would have to work 142 hours each week to make a living wage.