COVID-19 hit as Ellis County ALICE families were priced out of survival
ALICE Report: A crisis in the making with a 65% increase in Texas ALICE households over 10 years, fueled by high-priced basics and stagnant wages
Waxahachie, Texas — When COVID-19 hit, nearly 3 million Texas households were already one emergency away from financial ruin — a 10-year record high — setting the stage for the unprecedented economic impact of the crisis, according to the state’s latest ALICE Report, released today by United Ways of Texas, in partnership with United For ALICE.
ALICE stands for Asset Limited, Income Constrained, Employed — these are households that earn above the Federal Poverty Level but still don’t make enough to make ends meet. In Ellis County, the latest available data shows that 15,701 households live within the “ALICE” threshold in 2018. Meanwhile, 4,274 households were in poverty in Ellis County— which means that 34% of households in Ellis County are struggling.
“These are people you know,” explained Stephanie Bowman, Program Director of United Way of West Ellis County. “ALICE households represent family members, neighbors, people you know at your church… local residents that are living paycheck-to-paycheck and are struggling to keep up with the basic cost of living in our region.”
Across the state over the last decade, Texas’ low-income families systematically lost buying power and financial stability as the high cost of essentials outpaced wages, driving the number of ALICE households to rise 65% by 2018, the report shows.
“ALICE represents those individuals and families who are working — and yet struggling. They are basically one emergency away from a crisis. COVID-19 became that one universal emergency,” said Adrianna Cuellar Rojas, president and CEO of United Ways of Texas. “Our economy is increasingly reliant on ALICE, the ones facing the greatest health and financial risks today — as the workers who don’t have health insurance, have no paid sick days, and whose children receive daily meals at school.”
To learn more about the local numbers and numbers across the state, the entire report is available at http://www.unitedforalicetx.org
Interim Executive Director, Kasey Cheshier adds. “The latest ALICE Report provides an in-depth look at Ellis County and a large portion of our population that were struggling even before the economic fallout of COVID-19. I highly encourage our local government officials, churches, other nonprofits and the business sector to look at this local data and see where the greatest needs are. We have amazing leaders in Ellis County and I believe that given this information, there are groups of people here who can develop solutions to make life work better for the people who are working hard and unable to make ends meet.”
While wages for ALICE workers remained largely stagnant across the state, the cost of six essentials (housing, child care, food, transportation, health care and a basic smartphone plan) grew on average 3.4% annually over the past decade, in contrast to a rate of inflation of 1.8%.
As a result, ALICE households grew to account for 30% of Texas’ households in 2018, up from 21% in 2007. In contrast, poverty levels remained largely flat at about 14%. The new ALICE report shows that ALICE households were locked out of the boom economy and unable to establish savings due to minimal increases in pay and inconsistent job hours, schedules, and benefits.
“No matter how hard ALICE families work, the gap between their wages and the cost of basics just kept widening,” said Cuellar Rojas. “These already fragile ALICE households are now facing an even deeper financial hole due to the state of emergency created by COVID-19.”
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ALICE in Texas: A Financial Hardship Study shows that in 2018, the average cost of survival in Ellis County ranged annually from $26,676 for a single adult, to $29,676 for a senior citizen and $63,828 for a family of four with an infant and a preschooler. Putting these numbers in perspective, the median hourly wage for Retail Sales, the most common occupation in Texas, was $11.06, or $22,120 per year.
This mismatch between wages and costs is revealed by a new measurement debuting in this report, called the ALICE Essentials Index. This Index chronicles how the cost of housing, child care, food, transportation, health care and a smartphone plan rose at nearly twice the rate of inflation, as measured by the Consumer Price Index. The result is that in 2018, two parents working full time needed to earn $16.12 an hour in order to afford the Household Survival Budget for a family of four. That’s up from a wage of $10.88 an hour affording that budget in 2007. During the same period, the number of low-wage jobs grew by 62%.
“The ALICE Essentials Index shows that, through no fault of their own, ALICE families have been priced out of economic stability, setting the stage for the scope of this crisis,” said United For ALICE National Director Stephanie Hoopes, Ph.D. “Using the Consumer Price Index alone to measure inflation provides an incomplete picture of the cost of living, severely underestimating the mounting financial pressures on ALICE families.”
Cuellar Rojas recommends that the report’s findings be put in play immediately across the state to identify strategies and resources, both locally and statewide, to address the unique challenges that the COVID-19 pandemic has inflicted on ALICE families, as the impact of this pandemic on businesses and schools continues to play out.
The report calls for stakeholders across all sectors to use its findings to remove obstacles to financial stability, identify gaps in community resources and to build data-driven solutions to help ALICE families achieve economic stability, bolstering the state’s economy overall.
United Ways of Texas and United Way of Greater Houston are proud to sponsor the Texas ALICE report. The ALICE Report for Texas is a project of United For ALICE, a grassroots movement of some 650 United Ways in 21 states, corporations and foundations, all using the same methodology to document financial need. ALICE Reports provide county-by-county and town-level data, and analysis of how many households are struggling, including the obstacles ALICE households face on the road to financial independence.
To learn more about the local numbers and numbers across the state, the entire report is available at http://www.unitedforalicetx.org