
L.A.'s Cost of Living Crisis
Explore how new and existing economic challenges impact Angelenos and what can be done to solve them

Introduction
Population Living Below the Federal Poverty Level
Before the economic crunch caused by the COVID-19 pandemic, thousands of Angelenos were already facing rising costs, stagnant wages and a statewide housing shortage, leaving thousands without shelter. As many as 17% of residents were living in poverty , and estimates show that the number has likely increased over the past two and a half years.
Use the map on the left to look up the poverty rate for census tracts across L.A. County. Zoom out to see how L.A. compares to other counties in the United States.
Now, as high inflation impacts families and economic uncertainty lingers, the reality of soaring food, gas, and housing prices is taking a toll on working families up and down the Golden State. While the worst of the crisis arrived with the pandemic, Los Angeles has long faced unique challenges that have left far too many unable to realize the California Dream.
Explore L.A. Controller Ron Galperin’s story map below to learn more about how soaring prices are affecting people throughout the region.
The Problem
Los Angeles is a city unlike any other in the nation. Home to four million people, it is the second largest economy of any U.S. metro area and a hub for many industries—from technology and innovation to transportation and manufacturing.
But Los Angeles has long faced myriad pressing challenges. The high cost of housing, goods and services hampers economic mobility for the L.A.'s working families. Services such as childcare and the price of college tuition remain out of reach for too many and—despite recent growth—wages have failed to keep up with the cost of living.
Cost of Living on the Rise
Between 2018 and 2021, the cost of basic necessities jumped more than 20% in Los Angeles, leaving people without emergency funds to account for additional unexpected costs.
When the cost of basic goods continues to rise, it becomes almost impossible for lower wage households to thrive.
Table: Insight Center Report, 2021
Wages Not Keeping Up
While the minimum wage has increased in Los Angeles in recent years, it still lags behind the local cost of living. In L.A. County, a single adult in a minimum wage job would have to work at least 53 hours a week simply to meet their basic needs.
For families, it is even harder to keep up. An adult with two young children would have to work 142 hours a week in order to make a true living wage—essentially working around the clock.
Graphic: Insight Center Report , 2021
Lack of Affordable Housing Traps Millions in Poverty
Housing costs are often the largest burden for people in need as roughly 4.1 million households in California spend over 30% of their income on housing.
When economically insecure families are forced to spend so much of their budget to meet basic needs, there is an increased risk of poverty and falling into homelessness.
Graphic: California Housing Partnership, 2022
Inflation Hits Hard
During the pandemic, California's unemployment rate rose by 1.4 percentage points, the state's largest increase since 1976 . Los Angeles saw unprecedented demand at food banks at the time, with cars lined up for miles to receive critical supplies. Since then, food insecurity has only continued to get worse. As recently as April 2022, food banks across the state reported a surge in new visitors seeking services due to the rising cost of consumer goods . Controller Galperin’s Office has focused extensively on food insecurity and released a map of more than 1,400 food pantries, food banks and other locations distributing free food to those who need it.
Use the map below to find food pantries, food banks and other organizations offering free food to families in need.
Food Resources for Californians Map
Today, Angelenos are facing nearly 9% inflation , impacting the price of necessities like food, clothing, energry and gas. While recent data indicates that some costs—including the price of gas—may be leveling off a bit, tens of thousands of local families are still struggling to get by.
Consumer Price Index, Los Angeles area, BLS
Lift the Bottom Line
While many of the factors that have contributed to inflation and economic uncertainty are beyond invidual or local control, it is critical to do everything possible to safeguard L.A. and it's residents against future financial turmoil. After all, a Los Angeles where everyone can thrive (not just survive) is a healthier Los Angeles for all. Here are some actions local leaders can consider to protect Angelenos and the local economy.
Reduce Poverty
Poverty rates in Los Angeles are among the highest in the nation, with nearly one in three children living in poverty . Families who are already living at or below the poverty line are uniquely vulnerale to rising costs and the impact of inflation, even if prices increases are short-lived.
Research indicates that high inflation tends to worsen poverty and economic inequality due to the outsized impact it has on low- and middle-income families.
Poverty and inequality have plagued Los Angeles for far too long. It is critical that City leaders redouble their efforts to ensure that every Angeleno can afford a safe, healthy and dignified life.
Build More Affordable Housing
The cost of housing in L.A. has skyrocketed in recent years. During the latest home-buying surge, the median home price in L.A. County rose to more than $700,000.
Rent also remains stubbornly high. Three out of four households reported spending more than 30% of household income on rent and utilities in a recent survey of L.A. residents. The lack of affordable housing options leaves many vulnerable to housing insecurity and homelessness. Los Angeles currently has more than 40,000 residents experiencing homelessness.
Solutions to these crises have been slow to materialize. Six years after voters passed Proposition HHH, authorizing the use of $1.2 billion in taxpayer funds to create up to 10,000 units of homeless housing, high costs and extended building timelines have failed to keep up with the scale of the crisis. For more information, read Controller Galperin's latest report on the Problems and Progress of Prop. HHH .
Photo: UCLA Newsroom
Create Good Jobs
It is imperative that incomes match the prices of rising essentials so that Californians can live more efficiently. That can only happen if more jobs are created where workers can have the ability to earn better wages.
To make progress, communities, business owners and elected officials need to come together to support new, innovative and effective policies that provide solutions to this worsening issue.
Photo: Northland Connection
Support Small Businesses and Entrepreneurs
L.A. County is home to 250,000 small businesses and more than one million sole proprietors. These businesses account for 40% of the local workforce and make L.A.'s economy more vibrant and diverse. Small businesses have faced significant challenges during to the pandemic, forcing many entrepreneurs to shut down or downsize.
Small businesses are a central driver of local economic growth— creating two-thirds of new jobs —and it is critical that there are enough equitable avenues for recovery and growth. When local business owners are provided pathways to economic resilience, they are better able to provide higher wages for their workers, putting food on the table for both them and their families.
Photo: Triple Pundit