Affordability & Cost of Living: Wages vs. Prices
A focused path through purchasing power, hours of work, household budget shares and changing prices.
A focused path through purchasing power, hours of work, household budget shares and changing prices. Follow the steps in order to see how the underlying measures connect, where comparisons are valid, and where the evidence requires additional context.
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Define the affordability index
WP020 defines its Affordability Index as a category price index divided by an average-hourly-earnings index, with January 2000 set to 100.
See what became more affordable
WP020 finds several manufactured, digital and consumer categories became cheaper relative to wages even while several household-maintenance categories became less affordable.
Translate prices into hours of work
WP020 supplements price indexes with hours-of-work measures where defensible actual-dollar price series exist.
Compare household budget shares
WP020 reports a 12.3 percentage-point gap between the lowest- and highest-income fifths in the share of their own budgets devoted to housing in 2024.
Add healthcare premiums
WP020 reports Ohio employer-sponsored family premiums required 568.1 hours of an Ohio worker's pay in 2008 and 744.1 hours in 2025.
See why denominators matter
WP019 shows that age-bracket and all-household income denominators can materially change premium-to-income ratios.
Separate total premium from direct contribution
WP019 distinguishes the full family-plan premium from the worker's direct premium contribution.
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