Public Employee Press

Housing, gas prices drive cost of living rise in New York

The cost of living is increasing rapidly in New York, according to the federal Dept. of Labor. In New York, inflation is at its highest point in 15 years, the department reported in June.

The rising cost of living is walloping consumers as wages lag behind inflation. Average real weekly earnings (which are adjusted for inflation) rose by 3.5 percent from February 2005 to Februrary 2006.

During the last year, the consumer price index rose 4.8 percent in New York City and 26 surrounding counties.

High housing costs and the rising price of gasoline explain much of the increase, according to Michael L. Dolman, regional commissioner for the Bureau of Labor Statistics, who was quoted in an article in the New York Times.

Housing costs accounts for nearly half of the rising cost of living in New York. Over the past year, rent rose 5.6 percent in New York, compared with a 3.3 percent increase nationally. The rental value of homes in New York has gone up 0.6 percent a month in 2006, which is the longest such sustained rise in 20 years, according to the Times. In New York City, condominium conversions are reducing the supply of rental units — leading to a spike in rent costs — just as people are being
priced out of the homeowners market by rising mortgage interest rates.

The price of gasoline rose 36.6 percent in New York last year, ahead of the national increase of 33.4 percent.