Sushi Prices Show Where U.S. Cost of Living Is on the Rise
Sushi Prices Show Where U.S. Cost of Living Is on the Rise
(Bloomberg) --
Sushi prices in some of America’s fastest growing cities suggest living costs are rising quickly.
Diners in the Charlotte and Houston metropolitan areas -- where populations grew more than 10% over the past five years to reach close to 2.6 and 7 million, respectively -- are experiencing sticker shock. Average prices for spicy-tuna and California rolls rose at more than double the pace of the national average last year.
These are some of the findings from Bloomberg’s annual Sushinomics Index, a cost-of-living gauge that reflects not only the differences in price levels of the most iconic Americanized import of Japanese cuisine, but is also a proxy to measure changes in a city’s demographics, spending power, business growth and wealth flows.
New York City retained its ranking as America’s most-expensive sushi spot, another example of the city’s high living costs.
Meanwhile, New Orleans remained the lowest-cost metro area for sushi. Average prices for spicy-tuna and California rolls in the “Big Easy” rose just 1.1% over the past year, compared to the 2.9% average gain nationally. Sushi inflation was 6.7% in Charlotte and 6% in Houston.
The findings are somewhat in line with demographic trends in general with prices typically rising in cities with population inflows.
Miami, the city with one of the highest net gains of international population and levels of income inequality, saw the greatest price increase in premium rolls -- a recent addition to the gauge to help measure demand for higher-end items.
Sushi prices shouldn’t be used as an exact proxy for cost of living without considering other factors on the supply side said William Anderson, an economics professor at Frostburg State University in Maryland.
“What you’re doing is looking strictly at the demand side, but what are some of the other factors?” Anderson said. “You have to become almost an expert in the sushi business.”
Access to fresh ingredients, refrigeration and transportation distance all play a role in final restaurant costs. Also, some cities may have a more thriving restaurant scene for a particular cuisine, thus driving down prices with more competition.
Pricier Sushi, Fatter Wallets
Another thing to keep in mind when considering cost of living is average salaries. While New York and San Francisco rank highest in average cost for sushi, workers also typically receive greater pay. Among large metropolitan areas -- those with populations greater than two million -- the fastest growth in real personal income was seen in New York-Newark-Jersey City (4.3%), Seattle-Tacoma-Bellevue (4.3%) and Austin-Round Rock (4.1%) in 2017, according to the Bureau of Economic Analysis.
“Places with higher costs of living tend to also be higher earnings places and in some instances they are places with stronger amenities,” said Ryan Nunn, policy director at The Hamilton Project in Washington. “It’s not as simple as high cost of living is bad.”
Amenities of a city are those things people may decide is worth paying more for such as temperate weather, air quality and cultural attractions.
The national Sushi Index was set at 100 in the inaugural year of 2011, and reached 120 in the latest analysis. Of the 25 U.S. financial centers, 40% had readings higher than the U.S. average -- indicating prices were more expensive -- and 60% were below average.
To contact the reporters on this story: Shelly Hagan in New York at shagan9@bloomberg.net;Lee Miller in Bangkok at lmiller@bloomberg.net;Wei Lu in New York at wlu30@bloomberg.net
To contact the editors responsible for this story: Alex Tanzi at atanzi@bloomberg.net, Chris Middleton
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