West Michigan cities rank among tops for 'discretionary income'
A new report that takes salaries, cost of living and taxes into account ranks Michigan the No. 1 state in the U.S. for discretionary income — with several West Michigan cities also ranked highly.
The inaugural online Discretionary Income Report, created by the San Francisco-based moving and storage website Trove Technologies, ranks Michigan the top state for highest level of discretionary income.
Trove defined discretionary income as the amount of income leftover after subtracting estimated taxes and basic expenses.
The average discretionary income for single Michigan residents sharing a two-bedroom apartment with a roommate was found to be $8,163, or the 100th percentile.
The report shows salaries across all occupations in Michigan are 1.2 percent lower than the national average, while housing expenses are 32.4 percent lower and non-housing expenses are 8.2 percent lower.
Five cities in Michigan are ranked in the top 10 small cities for discretionary income: Jackson, Battle Creek, Lansing, Ann Arbor and Muskegon.
Among the West Michigan cities mentioned in the study, Muskegon ranks in the 98th percentile, with discretionary income of $6,273, Kalamazoo ranks in the 94th percentile, at $7,186, and Grand Rapids ranks in the 89th percentile, at $6,742.
“Grand Rapids ranks in the top echelon of cities when it comes to enabling workers to keep more of what they earn,” said Michael Pao, co-founder, Trove Technologies. “However, our research finds that salaries trail other cities in Michigan, such as Lansing and Ann Arbor.”
Salaries in Grand Rapids are 2.9 percent lower than the state average.
The ranking used wage data from the Bureau of Labor Statistics, state and federal tax rates from the Tax Foundation and cost of living data from The Council For Community and Economic Research.
The full methodology is outlined online.
Other Michigan cities on the ranking
Detroit: 91st percentile, $8,125
Lansing: 99th percentile, $8,528
Ann Arbor: 98th percentile, $9,072
Jackson: 99th percentile, $8,448
6. North Dakota
U.S. major city rankings
1. Austin, Texas
2. San Antonio
4. Nashville, Tennessee
6. Kansas City, Missouri
7. Columbus, Ohio
U.S. small city rankings
1. Odessa, Texas
3. Beaumont, Texas
4. Battle Creek
6. Ann Arbor
8. McAllen, Texas
9. Sherman, Texas
10. Laredo, Texas