A study produced by United Way of Wisconsin shows that nearly one-fourth of the state’s residents come from households with one or more employed adults, but still struggle to afford basic needs like childcare, housing and food.
Based on data collected in 2018, the study shows that more than one-third of the state’s residents either lived below the federal poverty line or had trouble making ends meet – two years before the COVID-19 pandemic.
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The focus of the study was the 23 percent of Wisconsin residents who are above the poverty line but below the “affordability line.”
United Way characterized that population with the acronym ALICE, which stands for people who are “Asset Limited, Income Constrained, (and) Employed.”
The study used federal statistics to define challenges faced by families in terms of housing, utility costs, childcare, food, transportation, health care, taxes and miscellaneous costs. It also examined the impact on senior citizens.
The study estimates that, in 2018, an estimated 549,313 Wisconsin residents were in the ALICE category, while another 262,960 people fell below the federal poverty line.
New statistics suggest improvement, with a shift from 38 percent of Wisconsin households falling below the ALICE Threshold in 2016, to the latest figure of 34 percent in 2018. However, the numbers don’t take into account the economic impact of the COVID-19 pandemic.
According to United Way, “households below the ALICE Threshold face acute hardship as the pandemic’s economic effects unfold.”
United Way of Wisconsin followed several basic principles to develop the study.
• All data is based on individual households, but not people who live in institutional group quarters, such as college dorms, nursing homes, homeless shelters, or prisons.
• The study uses federal data to measure the cost of living including housing, childcare, food, transportation, health care, and technology, plus miscellaneous expenses and taxes.
• Households that struggle to afford basic living costs were defined by number, demographic characteristics and geographic distribution.
• The study uses county-based statistics, because counties are “the smallest jurisdiction for which there is reliable data across the country.”
• Reliable data sources are used, including the U.S. Census Bureau, the U.S. departments of Agriculture, Housing and Urban Development, and the Bureau of Labor Statistics.
• United Way puts the data in context as a “means to understand conditions that struggling households face.
The study looks at how households struggle to find jobs with adequate pay, and the consequences of those struggles for the wider community; for example, more traffic and longer commutes as workers find lower-cost homes farther away from job sites.
Beginning as a pilot program in New Jersey, United For ALICE has grown to include 21 states and more than 648 local United Way chapters.
Each statewide study uses the same methodology to track financial need and hardship, using a model developed by United Way of Northern New Jersey in partnership with Rutgers University.
United For ALICE is funded and supported by AT&T, Atlantic Health System, Deloitte, Energy, Johnson & Johnson, Novartis and UPS.
The Wisconsin ALICE Report was supported by Thrivent Foundation, U.S. Venture/Schmidt Family Foundation, and local United Ways throughout Wisconsin.
