The Real Cost Measure in California 2023
Summary: This year’s release of the Real Cost Measure (RCM), like its predecessors, seeks to assess the true costs of living in California’s communities and the hardships households face in meeting them. The RCM is applied through multiple lenses. At the geographic level, authors conduct an “apples to apples” comparison among regions, counties, and neighborhood clusters. To determine how many households struggle to meet the RCM, the authors’ demographic analysis compares household income data to basic needs budgets for over 1,200 household configurations for each of California’s 58 counties, and up to 19 adults in a household. Authors also view the RCM through race, gender, nativity, occupational type, marital status, educational attainment, employment status, housing type, and more.
Findings: For one in three households in California (34%, over 3.7 million) even a modest level of security remains elusive. These struggling households reflect the diversity of California; they come from every household composition and represent every racial and ethnic group. Other noteworthy findings include:
- There are significant disparities throughout the state based on where people live, including within the same county (i.e. Santa Clara County has the highest median household income, while 52% of households in San Jose City fall below the Real Cost Measure).
- 97% of the 3.7 million households that fall below the RCM are engaged in the workforce and have at least one working adult in their household, and households led by single mothers struggle at higher rates (70% compared to 28% of households led by married couples).
- More than half (54%) of households in California with children under the age of six are struggling to make ends meet.
- Economic hardship is greater among non-naturalized immigrants: The proportion of foreign-born households earning income below the RCM is 37%, compared to 29% for U.S.-born people, and the percentage is even higher when the householder is not a citizen, in which case the rate of struggling households jumps to 57%.
- The high cost of housing is seen in the fact that 32% of families who live below the RCM cohabitate with others, as we find over one million households throughout the state living with other unrelated people in a household.
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