Data reveals four distinct income zones amid cost-of-living crisis
Therefore, these areas felt the cost of living crisis more than the rest of the city; bills and payments further consumed smaller incomes.
KPMG city economist Terry Rawnsley said the data offered a new perspective on the city: divided by financial capacity rather than geography.
How the other quarter lives: Mosman residents have no trouble covering unexpected expenses. Credit: Sam Mooy
“This is less about clear lines on a map and more about where high-income, middle-income and low-income people live,” he said.
Rawnsley also said much of the data showed that wealth and prosperity in many areas were “tied to the Sydney housing market”, with housing a major contributor to financial pressure.
The biggest differences across the city were in housing payments, both in real dollars and as percentages of income. In Mosman and Woollahra, where the average income exceeds $400,000, people spend less than 12 per cent of their income on housing.
Residents of Fairfield (26.7%), Canterbury-Bankstown (23.26%) and Cumberland (21.95%) all paid more, with median incomes below $105,000.
Along with other needs such as food, healthcare and transport, western Sydney residents paid more as a fraction of their income. While the region spent 8.35 percent of its income on food, 5.38 percent on health and 9.98 percent on transportation, this rate in the rest of the city was 7.88 percent, 5.04 percent and 9.49 percent, respectively.
Residents across the city saved an average of 15 percent of their annual income, with areas such as Ku-ring-gai, The Hills and Lane Cove saving more than 20 percent.
By comparison, Cumberland (3.97 per cent), Fairfield (4.60 per cent) and Canterbury-Bankstown (5.42 per cent) had the lowest average annual savings in Sydney.
According to Rawnsley, this was an important element in understanding how the cost of living crisis was affecting communities in Western Sydney.
“It’s about the financial buffer people have against shocks,” he said. “If you’re only left with 4 or 5 percent of your income after all expenses, you’re clearly under financial stress. Any unexpected payments can create even more stress.”
The data is for 2023-24 and includes spending on alcohol, communications, entertainment, dining out and other goods and services.
Western Sydney Center chief economist Neil Perry said the data revealed the “barriers” faced by Western Sydney residents and how the “barriers” were constraining the region’s prosperity. He said an easy way out is to support job creation.
“To increase incomes, people need more jobs, accessible, really good jobs.
Liverpool residents need more jobs close to home. Credit: Wolter Peeters
“People don’t have the same opportunities as people in the east. They may have the same skills, but they don’t have the same internal connections to get the same types of jobs as people in the east center of the city. So their skills aren’t recognized or valued as much.”
Ola Hamed, Cumberland’s mayor, said the data validates the experiences of her constituents, adding that some have cut back on basic needs.
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“Cost of living pressures are having a devastating impact on our region, with residents cutting back on food and avoiding going to doctors for treatment.
“The council is committed to working with all levels of government and I invite the prime minister, the premier of NSW and all their relevant ministers and MPs to come to Cumberland to see the reality in our region.”
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