Study finds Inland Empire hurt the most, while south Orange County, Ventura and north San Diego are hurt the least; generally, coastal regions less affected than areas farther inland
It may be known that Southern Californians are hurt at the pump, however, not all Southern Californians are equally affected. In fact, a new analysis by the Institute for Spatial Economic Analysis (ISEA) at the University of Redlands School of Business reveals there are areas in Southern California where the average household may not feel much of a burden at all, while others are suffering quite badly.
The Inland Empire leads the pack, with residents of Riverside and San Bernardino counties on average shouldering the highest burden, followed by L.A. and Kern counties. San Diego, Orange, Imperial and Ventura counties all have substantially lower oil burden on average, with Ventura’s residents carrying almost a one-third lower share of gas expenses relative to their income as compared to San Bernardino residents.
Not surprisingly, whether you feel pain at the pump depends not only on gas prices and how far you commute to work but also on how much your household income is, how much your vehicle consumes, whether you drive alone or carpool or use public transportation, and how many people in your household have to commute to work. The new study takes all of these factors into account and shows by Zip code how much consumers, per household, spend on average to commute to work as a share of their disposable income.
The areas that suffer the most can generally be found inland in suburban areas, and here the Inland Empire scores the highest due to the Inland Empire’s role as living quarters for L.A. and Orange counties, implying long drive times for residents as they commute to work. Disposable incomes in the Inland Empire are lower than in the coastal counties, due to its lower share of college graduates and larger share of blue-collar jobs. Generally, wealthier neighborhoods closer to business centers will suffer less, so the coastal communities will not be much affected while the High Desert suffers much more.
The ISEA research has shown:
- Among the eight counties in Southern California, consumers in the Inland Empire spend the largest share of their income on gasoline.
- The Ontario region and locations outside of Victorville are affected the most.
- Palm Springs seems to be affected the least, however, farther east, oil burden increases as commuters face longer drives to work.
- On average, Riverside and San Bernardino counties are almost identical in the share of disposable income spent on gasoline.
- Orange, San Diego and Ventura Counties show only very small areas where consumers are strongly affected. In Orange County, it is the areas towards L.A., while in San Diego and Ventura, it is the peripheral locations where consumers spend more of their income on gasoline for commutes.
- L.A. County marks the middle ground: Its traditionally more affluent areas such as Hollywood and the coastal areas are not much affected by higher oil prices, while the southern and eastern areas tend to spend more.
- As compared to national averages, Southern California scores high, but not the highest. Interestingly, many rural areas farther east in the U.S. exhibit higher pain at the pump than Southern California. Southern Californians, though, respond to it with higher rates of carpooling than the rest of the nation. Moreover, those hardest hit by high oil prices in Southern California actually live in areas with the relatively highest population density, which is also opposite to the nation as a whole. This raises the question again of whether public transportation could make a substantial dent in the oil dependency of Southern California.
Inspired by a previous study three years ago by Forbes magazine (http://www.forbes.com/2008/05/07/pain-pump-cities-forbeslife-cx_mw_0506realestate.html). The ISEA researchers combined data from Gasbuddy.com with ESRI estimates by Zip code on drive times, mode of transportation, employment shares, household size and household income to arrive at their projected values. The researchers point out that, given the data available to them, the projected values are only rough approximations of the true values and that accuracy is higher for Zip codes with larger populations. Given that, the observed patterns should still be helpful for decision-makers in politics, businesses and organization to determine where their efforts should best be directed.