This week, the Louisiana Association of United Ways released the state's ALICE report in hopes of shining a spotlight on the struggles some families endure to make a living.
Some areas of Louisiana may boast of an economic boom during recent years, but the plight Louisiana families face in making ends meet on a day-to-day basis remains.
This week, the Louisiana Association of United Ways released the state’s ALICE report in hopes of shining a spotlight on the struggles some families endure to make a living. The 253-page ground-breaking report is designed to explain the struggle of those who live at or below the ALICE line.
An acronym for Asset Limited, Income Constrained, Employed, ALICE is defined by those households above the poverty level, but unable to afford a basic budget of housing, child care, food, transportation and health care.
The guidelines utilized by the United Way as a measurement for ALICE households are a family of four (two adults with two children) making less than $42,444 or just about double that of the U.S. family poverty level of $23,550, or a single adult household making less than $17,304. The eye-opening data suggests that 40 percent of Louisiana households (694,719) qualify as ALICE.
“While these families are above the poverty level, they struggle with decisions on a daily basis,” explained Sarah Berthelot, President and CEO of the Louisiana Association of United Ways. “Do I buy medication? Can I fix my car or pay rent? They are living paycheck to paycheck and there is nothing left to address an unexpected expense or emergency.”
Some areas of the state face a more dire financial hardship than others, relatively speaking. All five of the highest ALICE areas are located in the northeast section of Louisiana. East Carroll Parish is the highest with an ALICE percentage of 66. Madison Parish (64 percent), Morehouse Parish (57 percent), Tensas Parish (55 percent) and Franklin Parish (54 percent) round out the worse situations. In comparison, Vernon Parish is right at the state average of 40 percent.
The largest metropolitan areas of the state reflect the plight of ALICE. Most are above the state average. New Orleans stands at 48 percent, Baton Rouge 44 percent, Shreveport 47 percent, Lake Charles 47 percent, Monroe 57 percent and Alexandria 49 percent. Only Lafayette is below the line at 37 percent.
So why engage in such a monumental research project? For the United Way, it’s an easy call. Berthelot said that the United Way is wanting to disperse the report to anyone and everyone who can make a difference in the lives of ALICE families. “We want this report placed wherever we can spark conversation,” she said. “There is no single solution to fix the problem, but everyone who is in a position to do good can make a more informed decision to help change this.”
The cost of living in Louisiana — especially in metro areas — is not getting any easier. One would think the ALICE level of $17,304 for a single adult in a household is enough to live on, however, the Survival Budget translates to $8.65 per hour, 40 hours per week. An efficiency apartment accounts for 36 percent of the Household Survival Budget, 6 percent more than affordability guidelines of 30 percent. Child care represents a family’s greatest expense in Louisiana — an average of $961 per month for two children in licensed and accredited child care, or $791 for registered home-based care.
The Household Stability Budget measures how much income is needed to “support and sustain an economically viable household, and includes a 10 percent savings plan,” according to the report. However, in Louisiana, the Household Stability Budget is $82,860 per year for a family of four — a whopping 95 percent higher than the Household Survival Budget. In essence, to afford the Household Stability Budget for a two-parent family, each parent must earn $20.71 per hour or one parent earn $41.42 per hour.
In 2013, the Louisiana averages for a survival budget of a single adult includes the itemized expenses of housing ($517), food ($177), transportation ($347), health care ($109), taxes ($161), and miscellaneous ($131), for a total monthly budget of $1,442. Comparatively, these numbers increased by at least 10 percent in every category except two from 2007 to 2013.
Entergy is a partner in this project with the United Way, and the utility giant witnesses the struggle to meet monthly bills. According to Patty Riddlebarger, Director of Corporate Social Responsibility for Entergy, “About 71 percent of those who call in are struggling to meet payments each month.”
Now three years following the “Great Recession,” Louisiana residents have depleted savings and are still having trouble finding higher-paying jobs. According to the report, the impact of ALICE forces families to live in substandard housing, while also leading to a migration farther away from job sites. And in extreme situations, homelessness ensues. Child care becomes substandard as well, or becomes impossible — forcing a single parent to balk at an immediate income and future promotions. Education is also affected without a stable home environment. All of these factors also affect each community as a whole.
How can the ALICE report spark change?
Riddlebarger said that the report can help Louisiana’s legislators make “data-driven decisions on how to apply funding on services that can make life better for these households.”
Berthelot expounds on that goal. “With this report in hand, we can all better understand the challenges of ALICE. We can foster dialogue and the report can be leveraged for communities to plan,” she said. “The research can be absorbed on a local level at our United Way offices.”