Internet Address: http://www.bls.gov/ro2/
Fax-On-Demand: (212) 337-2412
Media Contact: Michael L. Dolfman,(212) 337-2500
Information: Martin Kohli,(212) 337-2420
May 30, 2007
CONSUMER EXPENDITURES IN THE GREATER NEW YORK AREA, 2004-05
Consumer units in the New York metropolitan area spent an
average of $54,121 per year in 2004-05 period, 20.5 percent
more than the typical U.S. household, according to the
latest results from the Consumer Expenditure Survey released
by the Bureau of Labor Statistics of the U.S. Department of
Labor.1 Regional Commissioner Michael L. Dolfman noted that
the 7.6-percent rise in expenditures from the 2002-03 period
was about in line with the 7.1-percent rise in area retail
prices, as measured by the annual average Consumer Price
Index for All Urban Consumers (CPI-U).
Not only did households in the greater New York area
spend more than the U.S. average, they also allocated their
dollars differently. The percentages, or shares, of annual
expenditures allocated for housing, apparel, and education
in the greater New York area were significantly larger than
the portions spent nationally, while the shares allocated to
transportation, healthcare, and entertainment were
significantly below the national average. (See chart A.)
This report contains annual data averaged over a two-year
period, 2004 and 2005. The data are from the Consumer
Expenditure Survey (CE), which is collected on an ongoing
basis by the U.S. Census Bureau for the Bureau of Labor
Statistics (BLS). The Consumer Expenditure Survey is the
only national survey that provides both complete data on
household expenditures and the demographic characteristics
of those households for the nation, the 4 geographic regions
of the country and 24 metropolitan areas. Survey data
cannot be used to make cost of living comparisons between
areas. Expenditures vary among areas not only because of
economic factors such as the prices of goods and services
and family income, but also because of differences such as
the age of the population, climate, consumer tastes, family
size, etc. However, expenditure shares, or the percentage
of a consumer unit's budget spent on a particular category,
can be used to compare spending patterns across areas. The
survey provides average expenditures for consumer units. An
individual consumer unit may spend more or less than the
average, depending on its particular characteristics.
In the greater New York area, spending on housing, the
largest expenditure category, averaged $20,065 in 2004-05,
37.6 percent above the national average of $14,586. (See
table 1.) Compared with the 2002-03 period, housing
expenditures increased 6.1 percent, while the CPI-U for
housing advanced 8.6 percent. The increase for housing in
New York was largely due to greater expenditures for
shelter, up 7.0 percent, and utilities and fuels, up 15.5
percent.
Housing accounted for 37.1 percent of the budget in New
York in 2004-05, significantly above the 32.5 percent
allocated nationally. Often, an above-average expenditure
share for housing is a distinctive feature of large
metropolitan areas; even so, New York's share stands out
when compared with those of other major metropolitan
centers. For example, the portions of the budget spent on
housing in Los Angeles (35.7 percent) and Chicago (34.5
percent), the metropolitan areas ranking second and third in
population behind New York, were also significantly above
the national average, but not as high as in New York. (See
table 2.)
New York households spent an average of $13,271 on
shelter, the largest component of the housing category.
Nationally, a typical consumer unit spent significantly
less-$8,448-for shelter, which includes mortgage interest,
property taxes, repairs and rent, among other items.
Households in Los Angeles also spent measurably more than
the national average for shelter. Not unexpectedly,
residents of New York and Los Angeles were far less likely
to be homeowners than their national counterparts-58 percent
versus 68 percent. However, this was not the case in
Chicago. Even though households in Chicago also spent more
on shelter than the average consumer unit, their rate of
homeownership was above the national average at 73 percent.
In the greater New York area, households spent $7,581 on
transportation, the second largest budget category after
housing. The New York area expenditure share for
transportation, 14.0 percent, fell significantly below the
national average of 18.0 percent. In contrast, the
transportation share in Los Angeles (19.7 percent) was
significantly above that for the nation and in Chicago (16.2
percent), it was not appreciably different. Compared with
the 2002-03 period, New York's transportation expenditures
declined by 1.9 percent, as a 35.9-percent increase in
spending on gasoline and motor oil was more than offset by a
20.9-percent decrease in spending on vehicle purchases.
Nationally, households allocated 43.0 percent of their
transportation expenditures to new vehicles; in the greater
New York area, new vehicles accounted for only 30.6 percent
of transportation spending. In Los Angeles and Chicago the
shares were 45.5 and 45.2 percent, respectively. New York
area consumer units also averaged the lowest number of
vehicles per household, 1.4, while residents of Los Angeles
(1.9) and Chicago (1.8) were closer to the national average
of 2.0 percent. By contrast, households in the New York
area spent a larger-than-average percentage of their
transportation budgets on public transit, 13.9 percent
versus 5.5 percent for the nation. The proportion of
spending allocated to public transportation (which includes
fares for subways, trains, buses, taxis, and planes) was
also above average in Chicago (7.3 percent), though not
nearly as high as in New York, but little different from
that for the nation in Los Angeles (5.8 percent).
New York area households spent an average of $7,283 on
food, the third largest budget category. New Yorkers
allocated 13.5 percent of their overall expenditures for
food, not appreciably different from the national average of
13.0 percent. Los Angeles residents allocated 12.7 percent
of their budget for food, which was also close to that for
the nation. Chicago households, however, spent a measurably
smaller portion of their budget on food, 11.8 percent.
Households in New York allocated $4,014, or 55.1 percent
of their food budgets, to food prepared at home, while the
national figure was 56.7 percent. Conversely, New Yorkers
devoted 44.9 percent of their expenditures for food to food
prepared away from home, such as restaurant meals, carry-
outs, board at school, and catered affairs; nationally, the
typical household spent 43.3 percent.
Payments for personal insurance and pensions, the fourth
largest expenditure category, accounted for 11.2 percent of
the typical New York area budget, in line with the national
average of 11.1 percent. In Chicago and Los Angeles,
expenditure shares for personal insurance and pensions were
both significantly below average at 10.3 percent.
A typical consumer unit in the New York area spent a
significantly larger portion of its household budget on
apparel and related services (5.3 percent) than did the
average consumer unit in the U.S. (4.1 percent). In Los
Angeles and Chicago, the expenditure shares for apparel (4.3
and 4.2 percent, respectively) were not so different from
that for the nation.
Out-of-pocket health care expenses-which include health
insurance premiums, medical services, drugs (prescription
and nonprescription), and medical supplies-accounted for 4.5
percent of total household expenditures in New York,
significantly less than the 5.8 percent recorded nationwide.
Shares for health care were also measurably lower in Los
Angeles (4.1 percent) and Chicago (5.3 percent).
New York area households also spent a significantly
smaller share of their budgets on entertainment, 4.3
percent, than the 5.1-percent national average. In
comparison, households in Chicago and Los Angeles allocated
4.8 and 4.9 percent, respectively, for entertainment, little
different from the percentage allocated nationwide.
Expenses for education accounted for 3.0 percent of a
typical New York area household's total expenditures,
significantly higher than the 2.1-percent U.S. average. In
contrast, the percentage spent on education did not vary
significantly from the national average in Los Angeles (1.7
percent) and Chicago (2.7 percent). Compared with the 2002-
03 period, education expenditures in the greater New York
area increased by more than 30 percent. At the national
level, education expenses rose about 20 percent.
________________________________
1For convenience, the New York metropolitan area, which
includes counties in three states-New York, New Jersey and
Connecticut-will be referred to as the greater New York area
throughout this release. Also, the terms consumer unit and
household will be used interchangeably. See the Technical
Note for more detail on these definitions.
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| Changes in 2004 |
| |
| Beginning in 2004, the Consumer Expenditure Survey tables included |
| imputed income estimates. While the imputed data provide more |
| reliable income estimates because they allow the inclusion of |
| households for which income data are not otherwise available, income |
| data from 2004 and 2005 are not strictly comparable to data from 2003 |
| and earlier years. |
| |
| This change also affected those expenditure items in the personal |
| insurance and pensions component that are derived from income data. |
| As a result of the changes that started in 2004, income data, personal |
| insurance and pensions, and average annual expenditures are not |
| strictly comparable to data from previous years. Data for 2004 and |
| 2005 are comparable to each other. |
| |
| For further information, contact the Division of Consumer |
| Expenditure Surveys, Office of Prices and Living Conditions, Bureau of |
| Labor Statistics, 2 Massachusetts Ave., N.E., Washington, DC 20212- |
| 0001 or call 202-691-6900. |
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Technical Note
The current Consumer Expenditure Survey (CE) program began in 1980.
Its principal objective is to collect information on the buying habits
of American consumers. The consumer expenditure data are used in a
wide variety of research by government, business, labor, and academic
analysts. The data are also required for periodic revision of the
Consumer Price Index (CPI).
The survey consists of two components, a diary or recordkeeping
survey, and an interview survey. The Diary Survey, completed by
participating consumer units for two consecutive 1-week periods,
collects data on frequently-purchased smaller items. The Interview
Survey, in which the expenditures of consumer units are obtained in
five interviews conducted every 3 months, collects data for larger-
cost items and expenditures that occur on a regular basis. The U.S.
Census Bureau collects the survey data.
Each component of the survey queries an independent sample of
consumer units which is representative of the U.S. population. Over
the year, about 7,500 consumer units are sampled for the Diary Survey.
The Interview Survey is conducted on a rotating panel basis, with
about 7,500 consumer units participating each quarter. The data are
collected on an ongoing basis in 102 areas of the country.
The integrated data from the BLS Diary and Interview Surveys
provide a complete accounting of consumer expenditures and income,
which neither survey component alone is designed to do. Due to
changes in the survey sample frame, metropolitan area data in this
release are not directly comparable to those prior to 1996.
The expenditure data in this release should be interpreted with
care. The expenditures are averages for consumer units with the
specified characteristics, regardless of whether or not a specific
unit incurred an expense for that specific item during the recording
period. The average expenditure may be considerably lower than the
expenditure by those consumer units that purchased the item. This
study is not intended as a comparative cost of living survey, as
neither the quantity nor the quality of goods and services has been
held constant among areas. Differences may result from variations in
characteristics such as consumer unit size, age, preferences, income
levels, etc. Users should keep in mind that prices for many goods and
services have risen since the survey was conducted.
In addition, sample surveys are subject to two types of errors.
Sampling errors occur because the data are collected from a
representative sample rather than the entire population. Nonsampling
errors result from the inability or unwillingness of respondents to
provide correct information, differences in interviewer ability,
mistakes in recording or coding, or other processing errors. The year-
to-year changes are volatile and should be interpreted carefully.
Sample sizes for the metropolitan areas are much smaller than for the
nation, so the U.S. estimates and year-to-year changes are more
reliable than those for the metropolitan areas.
Some expenditure components are subject to large fluctuations from
one year to the next because these components include expensive items
that relatively few consumers purchase each year. Thus, shifts from
year to year in the number of consumers making such purchases can have
a large effect on average expenditures. Examples of these types of
expenses are purchases of new cars and trucks in the transportation
component, and spending on boats and recreational vehicles in the
entertainment component.
Tests of statistical significance are used in this release to
compare expenditure amounts and shares for the 14 major expenditure
categories in the United States to the amounts and shares of the
following metropolitan areas: Chicago, Los Angeles, and New York.
For these three areas, the release identifies expenditure amounts and
shares different from the national figure after testing for
significance at the 95 percent confidence interval.
NOTE: A value that is statistically different from another does
not necessarily mean that the difference has economic or practical
significance. Statistical significance is concerned with our ability
to make confident statements about a universe based on a sample. It
is entirely possible that a large difference between two values is not
significantly different statistically, while a small difference is,
since both the size and heterogeneity of the sample effect the
relative error of the data being tested.
Metropolitan area definitions are based on Core-based Statistical
Areas defined by the U.S. Office of Management and Budget. The
metropolitan areas and their component counties and cities discussed
in this release are:
Chicago-Naperville-Michigan City, Ill.-Ind.-Wis.: consists of
Cook, De Kalb, Du Page, Grundy, Kankakee, Kane, Kendall, Lake,
McHenry, and Will Counties in Illinois; Jasper, Lake, Newton, and
Porter Counties in Indiana; Kenosha County in Wisconsin.
The Los Angeles-Long Beach-Riverside, Cal.: consists of consists
of Los Angeles, Orange, Riverside, San Bernardino, and Ventura
Counties in California.
The New York-Newark-Bridgeport, N.Y.-N.J.-Pa.: consists of Bronx,
Dutchess, Kings, Nassau, New York, Orange, Putnam, Queens, Richmond,
Rockland, Suffolk and Westchester Counties in New York; Bergen, Essex,
Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean,
Passaic, Somerset, Sussex, and Union Counties in New Jersey;
Fairfield, Litchfield, and New Haven counties in Connecticut; and Pike
County in Pennsylvania.
Definitions
Consumer unit - Members of a household consisting of (a) occupants
related by blood, marriage, adoption, or some other legal arrangement;
(b) a single person living alone or sharing a household with others
but who is financially independent; or (c) two or more persons living
together who share responsibility for at least 2 out of 3 major types
of expenses-food, housing, and other expenses. Students living in
university-sponsored housing are also included in the sample as
separate consumer units.
Total expenditures - The transaction costs, including excise and sales
taxes, of goods and services acquired during the interview period.
Estimates include expenditures for gifts and contributions and
payments for pensions and personal insurance.
Income - The combined income earned by all consumer unit members 14
years or old or over during the 12 months preceding the interview. The
components of income are wages and salaries, self-employment income,
Social Security and private and government retirement income;
interest, dividends, and rental and other property income;
unemployment and workers' compensation and veterans' benefits; public
assistance, Supplemental Security Income and Food Stamps; rent or
meals or both as pay; and regular contributions for support, such as
alimony and child-support payments.
NYLS - 7284 Labor - New York
5/25/07
Table 1. Average annual expenditures and consumer unit characteristics,
United States and the three largest metropolitan areas,
Consumer Expenditure Survey, 2004-05
__________________________________________________________________________________
| | | |
| | | |
Item | United | Chicago | Los | New York
| States | | Angeles |
__________________________________________|________|_________|_________|__________
Number of consumer units (in thousands)... 116,808 3,189 5,112 7,687
Consumer unit characteristics:
Income before taxes .................... $56,593 $67,726 $65,810 $74,851
Age of reference person................. 48.5 50.1 46.9 50.6
Average number in consumer unit:
Persons................................. 2.5 2.6 2.9 2.6
Children under 18....................... .6 .7 .8 .6
Persons 65 and over..................... .3 .3 .3 .3
Earners................................. 1.3 1.4 1.5 1.4
Vehicles................................ 2.0 1.8 1.9 1.4
Percent homeowner....................... 68 73 58 58
Average annual expenditures............... $44,928 $54,935 $55,760 $54,121
Food..................................... 5,855 6,456 7,062 7,283
Food at home............................ 3,322 3,453 3,876 4,014
Cereals and bakery products............ 453 473 492 568
Meats, poultry, fish, and eggs......... 822 815 976 1,109
Dairy products......................... 374 365 411 462
Fruits and vegetables.................. 556 609 749 766
Other food at home..................... 1,116 1,192 1,248 1,111
Food away from home..................... 2,533 3,002 3,185 3,269
Alcoholic beverages. .................... 442 581 485 553
Housing.................................. 14,586 18,962 19,911 20,065
Shelter................................. 8,448 11,440 13,030 13,271
Owned dwellings........................ 5,688 8,510 8,122 8,277
Rented dwellings....................... 2,273 2,138 4,383 4,245
Other lodging.......................... 487 792 524 749
Utilities, fuels, and public services... 3,057 3,541 2,908 3,528
Household operations.................... 777 1,063 1,224 957
Housekeeping supplies................... 603 792 632 579
Household furnishings and equipment..... 1,701 2,124 2,119 1,730
Apparel and services..................... 1,851 2,318 2,386 2,858
Transportation........................... 8,081 8,875 10,972 7,581
Vehicle purchases (net outlay)......... 3,478 4,013 4,996 2,316
Gasoline and motor oil................. 1,806 1,754 2,312 1,495
Other vehicle expenses................. 2,354 2,464 3,029 2,716
Public transportation.................. 444 644 635 1,054
Healthcare .............................. 2,625 2,933 2,275 2,412
Entertainment............................ 2,279 2,629 2,719 2,330
Personal care products and services...... 561 664 798 687
Reading.................................. 128 162 158 144
Education................................ 924 1,456 960 1,643
Tobacco products and smoking supplies.... 303 346 179 265
Miscellaneous............................ 751 920 848 1,064
Cash contributions....................... 1,535 2,969 1,272 1,168
Personal insurance and pensions.......... 5,006 5,665 5,736 6,068
Life and other personal insurance....... 386 384 298 422
Pensions and Social Security............ 4,619 5,282 5,438 5,646
__________________________________________________________________________________
Table 2. Percent distribution of total annual expenditures, United States and the
three largest metropolitan areas, Consumer Expenditure Survey, 2004-05
___________________________________________________________________________________________
| | | |
| | | |
Item | United | Chicago | Los | New York
| States | | Angeles |
____________________________________________|_________|___________|___________|____________
Total ..................................... 100.0 100.0 100.0 100.0
Food ..................................... 13.0 11.8 12.7 13.5
Alcoholic beverages ...................... 1.0 1.1 .9 1.0
Housing .................................. 32.5 34.5 35.7 37.1
Apparel and services ..................... 4.1 4.2 4.3 5.3
Transportation ........................... 18.0 16.2 19.7 14.0
Healthcare ............................... 5.8 5.3 4.1 4.5
Entertainment ............................ 5.1 4.8 4.9 4.3
Personal care products and services ...... 1.2 1.2 1.4 1.3
Reading .................................. .3 .3 .3 .3
Education ................................ 2.1 2.7 1.7 3.0
Tobacco products and smoking supplies .... .7 .6 .3 .5
Miscellaneous ............................ 1.7 1.7 1.5 2.0
Cash contributions ....................... 3.4 5.4 2.3 2.2
Personal insurance and pensions .......... 11.1 10.3 10.3 11.2
___________________________________________________________________________________________
Last Modified Date: May 31, 2007
Bureau of Labor Statistics
