Mamdani addresses the state of economic affairs for New York City's workers

On April 6, Mayor Zohran Mamdani released his inaugural “True Cost of Living” plan, an effort to quantify what it actually takes to live in New York City and to ground his campaign promise of making the city more livable for working people.

The findings underscore a broader economic reality of the widening gap between what work pays and what life costs, which forces many to trade long-term security for short-term survival. These rising costs have created what labor advocates describe as a pervasive crisis of financial insecurity.

“The True Cost of Living Measure offers an honest account of what it actually costs to live in this city — and who is being left behind,” Mamdani said in announcing the report. “This is not a crisis affecting a small minority of New Yorkers. It is touching the vast majority of our city.”

According to the report, 62 percent of New Yorkers—more than 5 million people—do not earn enough to meet their actual cost of living, a far higher share than traditional poverty measures capture. Many fall into what policymakers describe as a “missing middle”: roughly 3.6 million residents who earn above the federal poverty line but still cannot afford basic necessities.

For families with children, the gap is especially stark, with median annual costs nearing $159,000 compared to about $124,000 in available resources.

The minimum wage, which is $17 an hour in New York City in 2026, covers less than half of what a single adult needs to live in the city. While there is a campaign to raise the minimum wage to $30, it faces pushback from business owners and bureaucracy. 

The report also finds that Black and Latino New Yorkers are disproportionately affected, alongside households with children and people with disabilities. “We cannot tackle systemic racial inequity without confronting the affordability crisis head-on,” Mamdani said as he announced the Cost of Living Measure along with a long-delayed Racial Equity Plan. “And we cannot solve the cost-of-living crisis without dismantling systemic racial inequity.” 

Deputy Mayor for Economic Justice Julie Su reiterated how affordability is central to the administration’s agenda. “Ensuring that New Yorkers can afford the actual costs of living and raising a family is at the center of our economic justice agenda,” she said, adding that economic justice cannot be separated from addressing structural inequities.

Pressures beyond City Hall

Yet global instability—from the U.S.-Iran war to tariff-driven price increases under President Trump—has also pushed up the cost of everyday goods. Gas prices, for instance, jumped from $2.90 to $3.70 per gallon in a few weeks, one of the sharpest increases in decades. 

At the same time, the labor market has begun to soften.

Data from the state Department of Labor shows the city lost roughly 20,000 jobs in 2025, ending the year with about 4.8 million jobs—well below earlier expectations of growth. The steepest decline came in home healthcare, where employment was revised downward by 46,000 positions, reflecting state efforts to rein in Medicaid spending and slowing what had been a key source of job growth..

In particular, unemployment among college graduates in their 20s has risen to 6.5 percent, nearly matching the rate for their non-degree peers—a sharp reversal from the early pandemic period. Entry-level job postings and internships have both declined significantly, limiting pathways into stable employment.

“New York City’s youth unemployment rate, especially for college graduates, is an alarming trend,” said Comptroller Mark Levine in a statement. “Whether it is the high cost of living or the impact of AI, everyone in government should be focused on how we help young people entering the workforce.”

Housing remains many peoples’ central burden. According to the housing site Zillow, one-bedroom rents average more than $3,500 a month and climb much higher in many neighborhoods throughout the city, forcing workers into overcrowded housing, long commutes and tradeoffs between essentials like food, healthcare and savings. 

Department of Buildings Commissioner Ahmed Tigani said at the press conference the data reinforces what many families already experience. “Most New Yorkers cannot afford to live in our city without support, with housing costs driving the burden for many families.”

Sacrificing future savings

Furthermore, as costs rise and wages lag, workers are increasingly sacrificing future savings for present stability.

According to new data from Fidelity, a growing share of Americans are taking hardship withdrawals from retirement accounts—often modest sums of around $1,900—to cover immediate expenses. Financial experts refer to this as “leakage,” a slow erosion of long-term security as savings are depleted before they can grow.

According to pundits, these figures illustrate how national policy decisions are reverberating through the city’s economy, leaving workers, businesses and policymakers squeezed as job losses increase demand for a social safety net that is itself under strain.

“The city of New York has taken pride in paying workers under the inflation rate,” said Marianne Pizzitola, president of the NYC Organization of Public Service Retirees.

Unionized employees still benefit from defined-benefit pensions, but those pensions are only one part of a broader retirement system that relies on supplemental savings—savings many cannot afford to set aside.

Pizzitola recalls being encouraged early in her career to contribute to the city’s deferred compensation plan, a tax-advantaged account designed to supplement pension income. She couldn’t afford to participate.

“I said, sorry, I don’t make enough money to do that,” she said.

She recently spoke with an EMT who, after paying for childcare, tolls and rent, was left with nothing—a situation she says reflects the experience of thousands of workers across the city.

After paying for basic necessities, Pizzitola said, "she doesn't have enough money. She's actually in the red already."