Photo by Sharon McCutcheon on Unsplash

When factoring annual salaries into the cost of living in a city, Houston was among the least affordable in Texas, according to Indeed data

Affordability is one of the Bayou City's most marketable qualities, but according to a study conducted with Indeed salary data, Houston is one Texas city where a person's salary goes the least far.

Analyst Jed Kolko, chief economist at jobs site Indeed, used the website's salary data for various jobs in 185 American metros with 250,000 or more people and factored in cost of living data from the U.S. Bureau of Economic Analysis to find the metro areas where salaries stretch the furthest and workers have the most money left over after cost-of-living expenses. 

The Indeed data, which was gathered from April 2018 to April 2019, showed Austin as the city where a person's salary stretched the least in Texas, followed by Houston by a 1.9 percent difference. A worker in the metro areas of Dallas, San Antonio and El Paso has 0.7, 5.2 and 8 percent more expendable income, respectively, than Houston, according to the data.

"Differences in adjusted salaries can be big," Kolko said in his report. "The same job pays 49% more on average in Brownsville, TX than in Honolulu, after adjusting for cost of living — and 42% more in Fort Smith than in Myrtle Beach."

Map showing the adjusted salary differences of Houston and its 20 most-similar neighbors by job mix. Source: Indeed

This isn't the first study to shed light on Houston's deteriorating reputation as an affordable city. Last month, a study from a New York City-based cost analytics firm found the Bayou City as the second-most expensive big city (population greater than 1 million) in Texas to own a home, with Dallas being the first. 

“Historically Houston has provided a combination of job growth and relatively inexpensive housing,” Bill Gilmer, the director of the Institute for Regional Forecasting at the Bauer College of Business at the University of Houston, told Houstonia Magazine in 2018. “We provide a lot more opportunities when the economy is going well here. On average we have a very good amount of growth. The problem is, we don’t really tend to have those average years. It’s either very good or very bad.”

On average, Houstonians pull in salaries of about $53,000 per year, 6.32 percent higher than the national average, and pay about 8 percent less for general housing expenses than people living in other large U.S. cities, according to the Bureau of Labor Statistics. These stats are counterbalanced by other realities. Houstonians spend an average of more than $12,000 a year to drive across the sprawl, an annual expense that clocks in at 23 percent higher on average than what residents of other large cities pay for transportation, according to Houstonia Magazine

The data overall showed smaller cities having the better outcomes in adjusted salaries after the cost of living is factored, but a few million-person metros stood out, including Birmingham, Memphis, Cincinnati, Indianapolis, Sacramento and others. The five-million-person metro with the highest adjusted salaries is Atlanta. 

Where adjusted salaries are highest in large metros. Source: Indeed

"Adjusted salaries stand out as an advantage of smaller labor markets, but on most other job measures, larger places are ahead," Kolko said in the report. "Bigger metros have faster job growth and lower unemployment. They’re also better positioned for the future, with more highly educated residents and a mix of occupations more likely to grow and less likely to be threatened by automation."

When the population size isn't taken into account, the cities where adjusted salaries are the highest include Brownsville and Laredo, Texas; Toledo and Canton, Ohio; Huntington, West Virginia; Rockford, Illinois; and Modesto, California. Overall, unadjusted salaries are 7 percent higher in larger cities than larger ones, but after adjusting for living costs, those salaries are 9 percent lower.