Analyzing Housing and Jobs Using ACS and BLS Data

In a modern society, employment is how most people get the money to by the things that satisfy their material needs to live. The largest expenditure for most American households is housing (BLS 2019a). Therefore a major determinant of where people live is how much money they make relative to the cost of housing in different areas.

The US Census Bureau's American Community Survey is a source of general information on the cost of housing. The US Bureau of Labor Statistics is a source of information on wages in particular occupations and geographic areas. Taken together, those two sources of information can be used to analyze the spatial distribution of jobs and housing, and help you find where the most affordable place to live might be given your occupation.

The US Census Bureau and the The American Community Survey

The US Constitution (article 1, section 2) requires the government to take a complete count (census) of its population every ten years in order to set the number of members from each state in the House of Representatives and the Electoral College (which elects the president). Over the years since the first census in 1790, the amount of information collected by the temporary Census Office grew to the point where the US Congress created the permanent US Census Bureau in 1902 (USCB 2019a).

The American Community Survey (ACS) is "an ongoing, continuous survey of communities taken by the US Census Bureau that collects information on topics like employment and income, housing, education, family, and language" (USCB 2019b).

Unlike the decennial census which is only taken every ten years, the ACS is continuously surveying people in America's communities so that data can be more current than the decennial census. However, because it is a survey rather than a complete count like the census, there is uncertainty about how accurately the sampling represents the facts on the ground, and that uncertainty is expressed in a statistical margin of error on most ACS values.

National Profile Page

Data from the ACS (and other surveys) is made available to the public through data.census.gov.

Basic national level demographic information for the US can be found on the United States profile page.

For example, data from the ACS 2013-2017 five-year estimates:

Population: 325,719,178
Median household income: $60,336
Median age: 38.1

US National Profile Page

National Housing Costs

The ACS also collects information on housing costs. These numbers can then be used with the median household income numbers above to evaluate the affordability of housing in a particular area.

Two useful values from the Selected Housing Characteristics (DP04) table are:

Selected Monthly Owner Costs (SMOC) - Housing units with a mortgage - Median (dollars): This is the median (middle value) for what homeowners pay in housing costs each month.
Gross Rent - Median (dollars): This is the median monthly rent that renters pay each month.

For example, national data from the ACS 2017 one-year estimates:

Selected monthly owner costs: $1,515
Gross rent (monthly): $982

Dividing those two numbers by the national median household income found above, a family earning the median household income and living in mortgaged house with the median monthly costs pays:

($1,515 * 12 months) / $60,336) = 30% of annual income to own a house
($982 * 12 months) / 60,336) = 20% of annual income to rent a house or apartment

US National Selected Housing Characteristics (Table DP04)

County Income Map

Income is distributed unevenly throughout the country, with notable clusters of high income (and high cost of living) on the west and northeast coasts.

There are a variety of layers available in ArcGIS Online to create maps of income. These examples use ArcGIS Online layers of county and ZIP Code data from the American Community Survey 2013-2017 5-year estimates. That data is also available as GeoJSON files here.

This county-level data layer contains a variety of variables from the American Community Survey, including median household income, selected monthly mortgage costs, and gross rent by county.

Creating a Median Household Income Map in ArcGIS Online

County Housing Affordability

Housing costs are generally higher in areas where income is higher. However, there are places where housing costs outstrip increased income, making those places less affordable.

ArcGIS Online allows you to style choropleths based on a ratio of two numbers. This allows us to create a housing affordability map showing the ratio of mortgage costs or rent to median household income.

Using numbers for Spokane County, WA:

The median household income is $52,159.
The median monthly mortgage is $1,349.
The percent of median household income consumed by median mortgage costs is (1,349 * 12) / 52,159 = 31%, which is slightly above the national median.
The median monthly rent is $842
The percent of median household income consumed by median rent is (842 * 12) / 52,159 = 19%, which is slightly below the national median.

Creating a Housing Affordability Map in ArcGIS Online

County Housing Data in data.census.gov

The county-level income and housing data can also be accessed via the county profile pages on data.census.gov.

County-level Data in data.census.gov

The Occupational Employment Statistics Query System: National Data

"The Bureau of Labor Statistics (BLS) of the U.S. Department of Labor is the principal federal agency responsible for measuring labor market activity, working conditions, and price changes in the economy. Its mission is to collect, analyze, and disseminate essential economic information to support public and private decision making. As an independent statistical agency, BLS serves its diverse user communities by providing products and services that are accurate, objective, relevant, timely, and accessible" (BLS 2019b).

"The Occupational Employment Statistics (OES) program produces employment and wage estimates annually for over 800 occupations. These estimates are available for the nation as a whole, for individual states, and for metropolitan and nonmetropolitan areas" (BLS 2019c).

The BLS makes OES data available through a web app called the Occupational Employment Statistics Query System (https://data.bls.gov/oes/).

To find national data about an occupation:

Select a search type: Multiple occupations for one geographical area
Select a geographyc type: National
Select one or more occupations: Select your occupation
Select one or more datatypes: All data types
Select one or more release dates: most recent
Select an output type: HTML

For example: there are 1,259,930 accountants in the USA, making an annual median wage of $70,500.

National Occupation Data in the Occupational Employment Statistics Query System

The Occupational Employment Statistics Query System: MSA-level Data

Cities and counties are historical political boundaries that define the areas that a city and county governments control. However, cities often have strong economic and social ties to other nearby cities, even though they are governed by separate local governments.

These groups of cities are called metropolitan areas. Counties and cities are political areas. Metropolitan areas are economic areas.

BLS and other federal agencies commonly make their data available for metropolitan areas. You can access information about your occupation in an MSA using the Occupational Employment Statistics Query System.

Select a search type: Multiple occupations for one geographical area
Select a geographyc type: Metropolitan or Non Metropolitan Area
Select one metropolitan area: Select your metropolitan area
Select one or more occupations: Select your occupation
Select one or more datatypes: All data types
Select one or more release dates: most recent
Select an output type: HTML

MSA Occupation Data in the Occupational Employment Statistics Query System

Finding a Neighborhood You Could Afford to Rent In

A common rule of thumb is you can afford to rent a house or apartment that where your annual income is 40 times the monthly rent (Streeteasy 2019).

Given a map of median rents by ZIP Code, you can identify areas where you could afford to rent a house or apartment.

The video below shows how to create a map of ACS data by ZIP Code that you can use to find areas where the median gross rent is at or below the maximum:

For example, in Spokane:

The annual median income for accountants in the Spokane MSA is $65,000
Using the 40x rule, you could afford a $65,000 / 40 = $1,625 a month to rent a house or apartment
Given that rents in Spokane County are fairly low (compared to the rest of the country) and accountants are fairly well paid, you would have a wide variety of options. In this case, ZIP Code 99203 (the South Hill neighborhood) is one of the more expensive neighborhoods in the area, but it would be affordable to a single accountant since the $1,056 median rent is well below the 40x income limit of $1,625

Creating a Map of Rent by ZIP Code

Viewing a Neighborhood in Google Maps Street View

Once you have identified a ZIP Code where you might like to rent or buy, you can walk around that neighborhood using Google Maps street view.

If you need to save or share a link to a street view image, click the ellipsis beside the place name, share or embed image, and copy link.

Getting a Link to a Google Maps Street View of a Location In a ZIP Code

How Much House Can You Afford To Buy?

While there are a variety of factors that affect how much you can pay to buy a home, a common rule of thumb is that you can afford a home valued at 2.5 times your annual gross income (McWhinney 2019).

Continuing the example above for Spokane, WA, and assuming you will be buying your house with a spouse/partner who makes about as much as you do:

The annual median income for accountants in the Spokane MSA is $65,000
With a spouse / partner, your annual household income would be 2 * $65,000 = $130,000
Using the 2.5x rule, you could afford a 2.5 * $130,000 = $325,000 house

Using a housing search website like Zillow.com, you can look at the type of house you could afford in a particular area.

Browsing Houses For Sale in Spokane, WA

Reference List

Bureau of Labor Statistics (BLS). 2019a. "Consumer Expenditures -- 2018." Accessed 10 October 2019. https://www.bls.gov/news.release/cesan.nr0.hTm.

Bureau of Labor Statistics (BLS). 2019b. "About the U.S. Bureau of Labor Statistics." Accessed 10 October 2019. https://www.bls.gov/bls/infohome.htm.

Bureau of Labor Statistics (BLS). 2019c. "Occupational Employment Statistics." Accessed 10 October 2019. https://www.bls.gov/oes/.

McWhinney, James. 2019. "How Much Mortgage Can You Afford?" Accessed 10 October 2019. https://www.investopedia.com/articles/pf/05/030905.asp.

StreetEasy. 2019. "How Much Rent Can I Afford?" Accessed 10 October 2019. https://streeteasy.com/guides/renters-guide/how-much-rent-can-i-afford/.

United States Census Bureau (USCB). 2019a. "History." Accessed 10 October 2019. https://www.census.gov/history/www/census_then_now/.

United States Census Bureau (USCB). 2019b. "American Community Survey (ACS)." Accessed 10 October 2019. https://www.census.gov/programs-surveys/acs/.