Are people leaving good paying jobs to move to Austin? (Houston: real estate market, health insurance)

[southwest1230]

Sometimes I wonder if the people leaving relatively stagnant cities are fooling themselves by coming to Austin, expecting to make as much if not more than the living-wage they had or lost. I'm speaking of non-tech folks here. Yes, I realize that tech is a big factor here, but not everyone has the background or skills to take advantage of that, and they come here too. Essentially, I'm speaking of someone who plans on doing something here besides tech or real estate. I realize that with a heavy tech background you can write your own ticket here, but I also know that the majority of people coming here from depressed areas in the midwest and east don't have that background.

Most of the rust-belt cities were great in their day...great infrastructure, rapid transit, parks, libraries, legendary sports rivalries, and such. The powers that be just wrote them all off starting in the 70's. Steel, cars, manufacturing in general, was outsourced, and, except for Chicago, and a few other mid-sized cities, they essentially died. The worst
would be Buffalo, Detroit, Cleveland, Youngstown, Pitt, and Rochester-Syracuse. Those cities were just left for dead. The only bright spots, if you want to call it that, would be Indy, Chicago, some of Milwaukee, Des Moines, Madison, some of Cinncinnati, and Ann Arbor. The reason Texas is thriving is its corporate tax structure, and even more so, its abject lack of unions. Its location next to Mexico also gives it a practically infinite supply of cheap labor as well. I still think someone in the midwest, including Cleveland, would be better off staying if they have a well-paying job, especially a union-based one. The main reason Austin is an entrepreneurial mecca is that there is an almost abject lack of unions, so people HAVE to work for themselves. LOL. It's almost funny, but its the God's truth! Those workers striking at GM and Chrysler, though we laugh, are all making a living wage with full benefits. I'm not sure what people expect that come here from Union-based cities, but, trust me, they make a virtue out of entrepreneurialism when its just a lack of living wage corporate union jobs that creates that scenario in the first place, along with the low corporate taxes. And, yeah, Cleveland still has its charms, particularly Shaker Heights and some of the revitalized city areas. It isn't quite Detroit YET. And I surely wouldn't relocate if I had a good paying union job, regardless of how crappy the inner cities of the rust belt many be. The inner-cities of Dallas and especially Houston suck just as much anyway.....and you have the great lakes for recreation.

[sheri257]

I often ask this question myself. While people go on and on about the cheaper cost of living in Texas, I don't hear much discussion about incomes. I can't help but wonder how far does cheap get you if you end up making less money?

I don't live in the midwest or the east coast but, I do live in Calfornia where I work as an RN with a union job. People love to scream about Cali's cost of living and how they move to Texas just so they can only pay $150K for a house but ... $150K is all I paid for my Cali house four years ago.

While I could only make about $26-$27 an hour in Austin, in California I'm making $43 an hour. And that goes up to $48 an hour by 2009 with full benefits. The only reason I'm making this kind of money is because California has really strong nursing unions whereas, Texas has no unions at all.

Stagnant wages are a problem nationwide but this 2006 report from the Dallas Federal Reserve says Texas household incomes statewide actually fell by $1,000 (-2.4 percent) from 2004-2005.

Spotlight: North Texas Income - Southwest Economy, Sept/Oct 2006 - FRB Dallas

Sometimes I wonder if our "cheap is better" culture ends up becoming a downward spiral because ... that can also easily mean you're making less money ... which would also explain why people are so obsessed with living cheap.

[southwest1230]

sheri, i think you're right.....its also the Wal-Mart effect. We pay less for outsourced products, but lose the very jobs that used to pay for the products in the first place, when they were just a tad bit more expensive. As you wisely said, how far does cheap get you if you're making less money(or I should say, lose your job to outsourcing)? You bring up many pertinent points, and I imagine, as typical when you pop bubbles of bull with the god's truth, should ruffle a few feathers here. Per the california reverse exodus to Texas, I think many people fool themselves running away just for Real estate reasons. One, the taxes eat up much, if not most, of the difference. Second, not everything is sky high there....the inland empire, smaller and mid-sized cities, and even some up and coming neighborhoods, are still within reach, AND you can keep the well-paying job, union or no union....there are essentially NO unions out here in Texas, except for the politically connected gov't jobs, which pay little as well. Lets just say you would struggle to find a gov't job here even for the 26-27K you mention. And I know that many people in Texas, including Austin, would KILL for even that 26-27.....and 48 an hour? Oh, God, they would die of shock landing something like that. Let's not forget that you get what you pay for, or should I say DON"T pay for, in taxes in Texas(no pun intended...). No state tax means no libraries, parks, roads, and education(Texas ranks somewhere around 48-49th out of 50 per school spending per pupil. No free lunch here, or anywhere). And Austin isn't even the tech mecca it may appear to be. Dallas has FAR more tech jobs, nummerically and percentage-wise, than Austin. Austin is essentially a service industry economy, with hospitality and gov't jobs completing much of the mix. And what kills me is that the wages are higher in Dallas and Houston, but home prices are higher in Austin. Makes no sense. Finally, Texas as a state has one of the highest crime rates, simply off the charts. Guns, from what I understand, don't even have to be concealed, on person or in vehicles. Gun shows are all over. They execute more people than most countries as well. It truly is a different world here. Thats why I can't figure out for the life of me why californians would leave such a wealthy and strikingly beautiful state, with jobs that pay living wages, for a state like Texas, just for the home values.........its not a mecca in any sense of the world. You would be better off going somewhere else on the west coast, like Portland or what have you......

[sheri257]

I agree with the Wal-Mart analogy also ...

The other thing that's so fascinating is when people brag about how well they're doing in Texas ... but that's after they sold their houses for a ton of cash in California. There's no way you'd have that cash if you had been living in Texas instead.

Now ... if you're going to live in Texas, that would be the way to do it ... cash out your California equity and live cheap somewhere else.

But you can't forget that the reason you were able to bank a lot of money was because you lived in California in the first place. You never would have had that same opportunity in Texas.

We could have cashed out also but, I looked at the Texas wages (not to the mention the working conditions which, for Texas nurses, are horrible because they don't have unions) ...

And we figured we'd be better off staying here in the long run. Afterall ... the pay discrepancy is quite large. But, I also realize it could be different for other professions.

[crbcrbrgv]

I've never lived in L.A. but have spent extensive time there. I currently live in Houston. People love to bash Houston yet I see it as a flat L.A. Downtown L.A. is nice and the wealthy parts are nice also but the same could be said about Houston. I am a teacher and Texas is probably one of the only states you can get ahead while living on the salary. Houston teachers start off higher than Los Angeles teachers and I couldn't imagine only being able to afford a crappola 1,300 square foot house in Van Nuys. Especially when I could get one twice the size for half the price or less. As for your generalizations in Houston I don't see it. Many Californians tend to think we are all a bunch of gun totin' weirdos over here. That is about as fair as saying everyone in California is either rich or gay. But that is what many Texans think. Neither opinion is true. But something else that is true is the cost of groceries (much more expensive in CA) cost of utilities (more expensive in CA) and the cost of health insurance drain a person's resources in California quickly unless they are making 100k or more a year. I do agree with you about Austin. I don't understand its appeal either. It's like a clean New Orleans with less crime, i.e. it has 7 blocks of fun and the rest of the city is nothing (Pre-Katrina, of course).

[sheri257]

Originally Posted by crbcrbrgv

But something else that is true is the cost of groceries (much more expensive in CA) cost of utilities (more expensive in CA) and the cost of health insurance drain a person's resources in California quickly unless they are making 100k or more a year.

It does largely vary by individual circumstances but ... When people say that gas, groceries, utilities, etc. is much more expensive in California ... it also depends on where you're living in California.

I live in the Inland Empire, which is much cheaper than LA. Since my mortgage is pretty much the same as it would be in Texas ... that's a moot point for me. My property tax is a lot lower than Texas ... on other hand, I have to pay California income tax.

But, when I run these cost of living calculators ... the cost difference including higher housing prices (which we didn't pay) is only 15-20 percent ... when you look at the cheaper inland areas of California.

Our gross income is $155,000 (not including my overtime at $63 an hour which tends to bump us up to $165-$170K) so ... according to these cost of living caculators we'd have to be making at least $130,000 in Texas to maintain the same standard of living which is highly unlikely.

So ... when people say they've cut their cost of living in half ... is that because they paid cash for their houses and have no mortgage payment? Because naturally you're going to be living cheaper in that special circumstance but, not necessarily because Texas is that much cheaper.

[CravenClan]

I agree with Sheri, in some cases.... We are in So.Cal and have contemplated moving out of state for the last few years, we are now looking at Texas.

We are in Temecula, the Inland Empire, and have made good money on our house. As we contemplate Texas, some of the same things cross our minds, ie: Cheaper housing, less $$ for Health Insurance, no state income tax, BUT on a whole for our situation, similar to yours, it really equals out to be about the same as staying here, cost wise. We are not union, we are self employed, that is a little different. I think i also read on one of these posts before, that you need to make $150k + yearly to have the "no state income tax" thing work out for you in Texas. But overall for our situation, it does "cost" wise work out to be the same.

On the flip side, in our case, yes we are looking to take our cash and live a slower pace, so for us it is about the QUALITY of life...meaning, the people, business, and slow down of living somehwere other than California. People seem so busy, rushing to work and working their butts off to stay afloat...or atleast that is how it looks here. It does not seem like a friendly place, and i have lived here, in the same city for 21 years...So while everyone wants for different things, i think it depends on an individual basis.

You are right, if we had not lived here, we would not have made the money we have, and no we would not be able to go somewhere else, and live comfortably, so we are thankful for that. We are still on the fence, as my husband and I have been here so long, you just get used to people that way they are, and move forward. But there is something in both of us that thinks "there has to be more to life than this" Is there?? i look around and say to myself, this can't be it, Is it??

California is beautiful, but i think more beautiful 15 years ago, atleast where i am , now. It has grown immensley, but funny as i read these boards/posts, everyone wants to blame somewhere else for ruining their city/state. I am not one of those that look at all these people who moved to Temecula and say, they ruined it!! I say the people that ruin it, are the ones from other parts of California (SD/OC) that come here with attitude and make it a crappy place. But realistically, they may not even be from SD ro OC, they are from somewhere else, moved here for a few years, and now say they are from California, i guess it just sounds good!

Moderator cut: P&OC

[satanoid]

Austin is more expensive for good reason: it's austin.
The only problem with living in dallas is that you have to live in DALLAS.

[twange]

Thanks for the pic of my hood, Southwest

I agree with your point about staying in the Rustbelt if you have a union job. That's the problem; the unions are disappearing in that region because they are either getting broken or because the jobs are simply going overseas. Why do you think that Ohio has become a Red State when it has traditionally been Blue? No more unions. The reason the Rustbelt (Cleveland in particular) is losing population is two-fold:

1.)The city did not make the transition soon enough to alternative industries while facing the impending end of the manufacturing era. As these jobs were dwindling, the city has not/did not attract newer employment sources for a generation trained in information/technology careers. I could write a book about this, but in short, Cleveland was not fast enough in realizing its changing population. The city is notorious for its poor, bloated, insular leadership. For example the city has 3 times the city council members that Austin does, even though it's population is over 300,000 thousand less. Remember the old saying about "too many cooks in the kitchen"?

2.)White flight. The reason Cleveland's population is so small is not that nobody lives in the area, they just don't live in The City of Cleveland. If Cleveland were to incorporate it's inner ring suburbs and some of the other closer ones, it would be a city of approximately 1.4 million, instead of 410,000. As it stands, the actual city has overall poor housing, terrible schools, an old infrastructure and very little incentive for people to move there. Since the great migration North of black folks in the 1930s to get good paying jobs, the city has been steadily losing it's central population. Population peaked in the 1950s at about 1 million. Some of this mass exodus had to do with zoning, as filthy factories were built right next to and in neighborhoods. Folks with the means to do so(mostly white), took off for the suburbs like Shaker Hts. and the city neighborhoods turned into slums. They've pretty much stayed that way, although of course there are really nice pockets.

People move for different reasons. It isn't always economic. Speaking for my wife and I, we simply wanted a change of scenery and something new to experience. We have some family here and our gigs were "mobile". We're making a bit less money here but we got rid of a lot of stuff we felt was weighing us down, and both of us are working part-time, so we feel like we're in an OK place. We didn't make a lot of money in Cleveland either. It's just not our number one priority.

It was hard for us to leave. Both of our fathers worked in the Rustbelt industries (steel and auto), so we'll always have authentic, fond feelings for the place. We aren't the type to chase trends and hot real estate markets. We like to enjoy life and experience different things The negativity and inertia in that part of the country was really starting to gnaw at us. I've always waived my city's flag proudly but I really tired of seeing the same mistakes repeatedly. This might be a national tendency(maybe even a human one), but that's probably another discussion. We were talking last night about how we grew up during the Dark Ages of the Great Lakes. Hopefully it will make a comeback but it will take many, many years and a complete shift of regional focus and values. Right now for us, Austin is like turning on the lights in a dim, gray room...or adding color to an old black and white photograph. You get the idea.

Is it paradise? Hell no. I'm sure I'll take plenty of abuse from old-timers here while expressing my opinions and dissatisfaction with the city's "short-comings". But that's OK with me, I'm really defensive and sensitive about my hometown as well. I can take it.

[Zzyzx]

I took a 40% pay cut for a better quality of life. No big whoop.