John Marman and Natsumi Makiyama work in health professions that would put them squarely in the upper middle class almost anywhere else in the United States.
He is a therapist, and she is a pediatric nurse. But they live with their two children in one of the priciest swaths of the country, San Francisco.
They feel squeezed — and perhaps surprisingly, City Hall agrees.
San Francisco now offers free child care to families of four earning up to $235,000 a year, including Mr. Marman and Ms. Makiyama. The city pays half the cost of child care for families making up to $325,000 a year, an eye-popping level that is more than 3.5 times the country’s median household income.
Raising a family in San Francisco, the city with the fewest children per capita in the United States, has never been easy or cheap. But the affordability crisis has soared to new levels this year as the artificial intelligence boom has driven up prices for everything. That has made life even more challenging for young families not working in the tech industry, and city leaders are desperately trying to ensure that those families don’t flee.
The child care help is one way to offset the city’s spiking housing costs, which have shot up 26 percent in the past year, prompting Mayor Daniel Lurie to recently declare a “rent emergency.”
Rents are higher in San Francisco than in any other large city in the country, according to Apartment List. The median rent for a two-bedroom apartment is now $4,640, the site said. The median cost of a single-family home in the city tops $2 million, a figure that these days would most likely buy a small, basic house in need of work.
On the housing front, Mr. Marman and Ms. Makiyama are comparatively lucky. Three years ago, as San Francisco was still recovering from the pandemic and the A.I boom had not yet exploded, the couple bought a 1,200-square-foot home on the western edge of the city for $1.3 million.
Mr. Marman, 36, brings in about $135,000 as a therapist for the city, and Ms. Makiyama, 39, is working part-time so she can stay home with their toddler son some days. Together, they make just under $235,000, qualifying for free preschool for their 4-year-old daughter.
Although they earn good salaries and own their own home, making ends meet just feels harder and harder.
Each month, they pay $6,400 for their home mortgage and $2,200 for two car payments, car insurance and gas, since they are unable to reach their jobs without their vehicles. Cell service and home Wi-Fi is another $300 per month. They put a little each month toward life insurance, their children’s college accounts and retirement.
They spend more than $150 each week on groceries and have become coupon clippers who try to make cartons of milk last longer than they used to and who visit different grocery stores on different days scouting for deals.
“I don’t want to say we’re rationing, but we’re definitely thinking about not using too much,” Mr. Marman said. “Every grain of rice is eaten, and we make sure there is no food waste. I’m the designated garbage disposal for the kids’ leftovers.”
They are saving less than they would like and will probably stop traveling for a while after annual trips to Japan to visit Ms. Makiyama’s extended family grew too expensive.
“At the end of most months, we’re struggling to find extra cash to enjoy a day out with the kids,” Mr. Marman said. “We’re very lucky to receive the benefit for school, but life is just still very tough.”
Without the school help, Mr. Marman said, they would probably have to leave San Francisco, the city where his family has lived for five generations.
Asked what he thought a family of four new to San Francisco — with no government help, no rent control, no trust funds, no foothold of any sort — would need to earn annually to lead a good, middle-class life, Mr. Marman paused.
“I think close to half a mill is the reality, which is absolutely ridiculous,” he said, noting the rest of the country would probably consider a $500,000 income for a middle-class lifestyle some kind of bad joke. “I think they would laugh at us, and honestly I think that’s fair.”
Even Mr. Lurie, the mayor who has fashioned himself San Francisco’s No. 1 hype man, did not dispute the number.
“Yes, it is an incredibly, extraordinarily expensive city to live in and to work in and to thrive,” he said in an interview in his City Hall office. “That’s why 50 percent off at $325,000 is so essential.”
Mr. Lurie, an heir to the Levi Strauss fortune whose mother is a billionaire and whose children attend elite private schools, might seem like an unlikely champion for family affordability. But, he said, any successful city needs middle-class families and the jobs they tend to fill — including nurses, therapists, police officers, firefighters, teachers and bus drivers.
“We don’t want them leaving for the suburbs or for other states,” the mayor said. “We want them here in San Francisco, and that’s what it takes, so that’s what we’re doing.”
The high salaries paid by technology companies, particularly in the booming A.I. sector, have driven up housing and other costs in San Francisco, making it less affordable for everyone who doesn’t work in the industry.
Mr. Lurie has pressed OpenAI and other local A.I. employers to help support city initiatives. “You can bet I am talking to the leaders of those companies,” he said.
But so far, those conversations have been fruitless.
The child care program is funded mostly by unused money from a commercial gross receipts tax passed by voters in 2018 to fund child care.
More than 9,300 children are enrolled at more than 550 private sites, including preschool centers and in-home day cares, and their families are saving up to $36,000 per child.
Families apply online and provide income information, and the city pays the child care center directly. The money cannot be used for private nannies or babysitters. The city spends $238 million annually to fund the program — including paying families’ subsidies, training and paying child care workers and improving facilities.
Mr. Lurie says San Francisco now has universal child care because all families can either afford to pay fully or qualify for city help.
He pointed out that while Mayor Zohran Mamdani of New York campaigned heavily on universal child care, New York City does not yet offer it to all children under 5.
“I’ll brag about that all day long,” Mr. Lurie said. (New York City has enrolled more children in child care programs than San Francisco, but given that its population is so much bigger, Mr. Mamdani’s pledge of universal care has been harder to accomplish.)
San Francisco families who take advantage of the child care assistance say that they’re grateful, but that it by no means makes life easy.
Bianca Finley, 32, and Chris Truitt, 36, use the subsidy to pay for their 3-year-old daughter’s preschool. But that is not their only strategy for curbing costs.
They gave up their rent-controlled, two-bedroom apartment in Noe Valley, an upscale neighborhood popular with families, that cost them $4,017 per month. They moved to a studio in the Tenderloin, a lower-income neighborhood, and pay $2,280 per month.
They are documenting the move on Instagram under the handle “The Poor Millennials.”
Both Ms. Finley and Mr. Truitt work in the wine industry, which has taken a beating in the past several years, and together earn $153,600 annually. They said they had grown tired of having a roommate in Noe Valley and of not being able to pay down credit card debt.
So far, they are happy with their decision, becoming experts in space-saving techniques like building a coffee table that turns into their daughter’s bed at night. But sometimes, they acknowledged, it is frustrating trying to get by in the city they love against the backdrop of such stark income inequality.
“We are trying to keep our mindsets focused on: Just because the system around us is broken doesn’t mean we have to be,” Ms. Finely said.
San Francisco is so pricey, even some people working in the booming A.I. industry get City Hall help. Emma Hare, a legislative aide at City Hall, and her husband, who works at an A.I. start-up related to robotics, bring in just over $300,000 per year and qualify for 50 percent off their son’s child care.
Ms. Hare’s policy brain thinks about whether a city’s role is to “help the median resident or have a really strong social safety net” for the poor, she said.
Her mom brain thinks about the opportunities her son will have growing up in San Francisco — the parks, the museums, the culture, the beauty — and has decided the daily stress is worth it.
Mr. Marman has landed on that answer, too. And for now, he isn’t going anywhere.
“We love this city. We believe in this city,” he said. “This is home.”
The post In San Francisco, a Family Earning $325,000 Qualifies for Government Aid appeared first on New York Times.
