There’s surviving, and then there’s thriving — and a new national study sifted through the numbers to show the difference for many families struggling to cover their costs every month.
According to the United Ways of Maryland, Virginia and the District of Columbia, data collected in 2021 showed 28% of the residents in each jurisdiction fall within what researchers refer to as the “ALICE” category.
That is, they are Asset Limited, Income Constrained, Employed, and earn more than the federal poverty level yet not enough to cover the cost of the basics, from rent, to transportation, to food and child care.
Franklyn Baker with the United Way of Central Maryland explained, “These are people who are not below the federal poverty level; they’re working,” but he said, “they just can’t keep pace with their state’s high cost of living.” Baker said that while COVID-related aid helped many from falling further behind, as those benefits dry up, households face continued pressures from the cost of living in their areas.
The data from UnitedforALICE, which includes United Way organizations in 27 states, calculates a “Household Survival Budget” for each state and county, and shows how the figures can vary due to geography. The data collected is from 2021 — see overviews for Maryland, Virginia and the District.
The issue with “survival budgets,” said Baker, is “that number keeps rising, but it outpaces the actual cost of living adjustments that employers are making in behalf of their employees.”
Baker said the fact that so many households have so little wiggle room means families work to find ways to cut expenses, including on health care. They may choose a plan that has a low copay, but, “the deductible is extremely high, so God forbid, you do actually have to utilize your health care, you’re really, really at a disadvantage.”
For example, in Montgomery County, the income needed by a couple with one pre-K aged child and one infant is calculated at $110,292. In Prince George’s County, that shifts downward to $92,228 to afford all the basics.
In Virginia’s Loudoun County, the income needed for the same family would top $114,576. In Fairfax, it would be $107,712.
Among those most likely to struggle, people who work in occupations, such as personal care, fast food and retail.
In the District, for example, 98% of people who work as personal care aids fall below the ALICE threshold, 66% of cashiers and 56% of fast workers are in the same category.
Even marketing professionals and those who work in the computer fields may find themselves unable to keep pace with the cost of living, according to the data in the report. In the District, 12% of marketing specialists and research analysts and 10% of those in the computer fields are below the ALICE threshold.
Baker said the job of the United Way organizations such as his in Central Maryland “is to soften the blow” of the rising costs families face, “so that they can get closer to reaching the aim of self-sufficiency and thriving.”
