Thread: Squeezed on all sides:New York’s middle class

Here's another article that fails to mention the "Contributions" of Illegal Aliens to the problem.

Squeezed on all sides: Bus and subway hikes are latest hit to New York’s middle class

By Jonathan Bowles

Sunday, August 1st 2010, 4:00 AM
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Norman Hernandez doesn't go out as much as he used to. When he's at home, he tries to put on the fan instead of the AC. And even before the MTA announced this week that it would hike subway fares, the 35-year-old Woodside resident had started biking everywhere to help keep expenses down. "Rider fees on bikes don't go up every two years," he says.

No kidding. Countless other New Yorkers have had to cut back their spending to survive the Great Recession. But unlike in some places or during some recessions, things aren't getting any cheaper in New York now.

On the contrary, the city that already had the highest cost of living in America before the downturn is getting even more expensive. Beginning in the fall, New Yorkers will pay $120 to $180 more each year for a monthly MetroCard, depending on which MTA proposal ultimately gets approved. Con Edison recently won approval to raise electricity bills by 12% over the next three years. CUNY tuition is going up, water rates have been rising, health care and child care costs are up, and the state will soon resume collecting sales tax on clothing purchases under $110.

These cost increases may seem like minor inconveniences. But they all add up to a huge headache for cash-strapped families. They come at a time when record numbers of New Yorkers are out of work and as wages for those who still have jobs have been stagnating.

Plus, these are only a few sources of the economic pressure on working New Yorkers. City residents pay among the highest prices in the nation for electricity. Telephone service, auto insurance, home heating oil, parking and milk are also higher here than virtually anywhere in the continental U.S. The combined state and local tax bill is also tops among major cities.

Though housing prices have leveled off of late, only 20.9% of housing in New York City was affordable to those earning the median income in the first quarter of 2010. No other region in the U.S. had a lower share of affordable homes.

All this particularly stings middle class New Yorkers and those who are aspiring to rise up to the ranks of the middle class, two groups that have fared particularly badly in the downturn. Two groups that, in our stratified city, are close to earning a place on the urban endangered species list.

Before the onset of the recession, New York's middle class already seemed under siege. The city's skyrocketing costs had prompted rising numbers of middle class residents to consider leaving the city for less expensive locales and left far too many New Yorkers stuck among the working poor, unable to achieve the American promise of upward mobility that has long been a hallmark of this city.

"What middle class?" was the quip I heard repeatedly while interviewing New Yorkers for a 2009 report about the challenges facing the middle class. That report concluded that to truly live like a middle-class family in this city, you have to have a six-figure salary. Scary but true.

Not surprisingly, the recession has made things even worse. A disproportionate share of the job losses in the five boroughs since 2008 has been in moderate- and middle-income wage sectors. It's blue-collar workers; it's secretaries; it's security guards. Only health care hasn't taken a huge hit - yet.

This has brought fresh financial insecurity to scores of solidly middle-class families, many of whom bought expensive homes here in recent years based on the expectation that two members of the household would hold full-time jobs. It's also pushed numerous working poor residents deeper into poverty - or at least sidetracked their dreams of getting ahead.

Just ask Hernandez, who is on the verge of graduating from LaGuardia Community College this summer. In his mid-30s, he went back to get his associate's degree in large part because he sees higher education as a ticket to the middle class.

"Education is the key to many doors," he says. "I know I can very well make more money than I used to with my degree."

That idealism ran smack into brutal reality. Hernandez, who intended to continue his studies at a four-year college, had to put those plans on hold when the transportation company he worked for laid him off three months ago. Even before that, he says it would have been a challenge to afford the tuition at one of CUNY's senior colleges, which went up from $4,000 to $4,600 last year and will increase again in the fall. Without a job, he simply can't make it work.

"It makes me sad that I cannot continue my studies right now," Hernandez says. "I have momentum and wanted to keep that momentum. But I'll have to put that on the backburner for the time being, until I'm employed again. It's not affordable for me at this point."

He says the only time in his life he felt he was middle class was when he served in the Army, primarily because he didn't have the overhead expenses that most New Yorkers have.

It's true: Many middle class professionals here earn higher salaries than in other parts of the country. But as numerous New Yorkers have discovered in the past year or two, the city's staggering cost of living leaves hardly any room for something to go wrong.

For some, that $120 a year on subway fares will be the difference between paying the bills and coming up short. For others, it will give them the final push out of New York. Indeed, an internal study conducted for the Bloomberg administration in 2006 found that 25% of New Yorkers who left the city did so because of the high cost of living, compared to just 8% of those who fled New York in 1993.

To be sure, the exorbitant cost of living is not the only explanation for the problems facing New York's middle class. Another key strain is that, even in good times, the city's economy no longer seems to produce enough jobs that pay middle-income wages and offer clear paths to advancement. The result is that large numbers of people in the five boroughs are working but not earning enough to live comfortably, save money or get ahead.

It's understandable and appropriate that Mayor Bloomberg and other local policymakers have put much of their recent focus on the immediate economic crisis. But it's time for the city and state to start addressing the long-term crisis facing New York: the challenge of retaining and attracting ordinary working families.

New York needs to preserve and grow a strong middle class - not only because that's always been at the core of the city's and country's success. It's also about survival. The city's critical competitive advantage in today's global economy is our people. At this rate, we risk losing the human capital that makes the city's key industries and institutions run.

That higher MTA fare may help the trains run on time. But it could also begin to empty those trains of the working people who've ridden them for years.

Bowles is director of the Center for an Urban Future, an independent think tank based in Manhattan. He co-authored, along with Joel Kotkin, "Reviving the City of Aspiration," a 2009 report about the challenges facing New York's middle class.

Read more: http://www.nydailynews.com/opinions/201 ... z0vOxQugO7

Don't believe Washington if they claim there are alot of jobs opened because what companies are doing now they're forcing early retirement of 55 yrs old and older and employing newly college grads with entry level pay. sad. people in their 50's are neither young nor old enough to retire and alot of jobs won't come back. this is nyc alone, i dont know about the rest of the country.

true the subways and PATH as well as the buses have increased and is looking to increase again in the next 6 months or so. and it doesn't help that the low and lower middle class is hit the most. we all know majority of small businesses will only hire illegal aliens to pay down the wage. in nyc and nj that's all i see small businesses hire. and it ain't an american.

we need politicians who will look out for americans and not illegal aliens. i wish we get a Gov. Brewer like Politicians to run next election in nj and ny.