United Way study: Texas living wage substantially above federal poverty guidelines

Texas Alice

The United Ways of Texas released a report Jan. 29 that said more than 4 million households in Texas – 42 percent – could not afford basic needs such as housing, child care, food, transportation, health care and technology in 2016.

The so-called ALICE report profiles Texans that are defined as Asset Limited, Income Constrained, Employed.

“This data shows, even though people are working hard, they are finding it difficult to make ends meet,” said TD Smyers, president and CEO of United Way of Tarrant County. “We are committed to assisting these individuals and families in Tarrant County.”

The average Household Survival Budget, a calculation created for the ALICE Report, for a Tarrant County family of four increased to $64,464 a year, which is significantly higher than the federally recognized family poverty level of $24,300. The household survival budget reflects the bare minimum a household needs to live and work today.

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United Way of Tarrant County will release its Community Assessment on Wednesday, Feb. 6.

The Community Assessment identifies what Tarrant County residents believe are the most pressing issues in the community and provides a clear directive of where funding is needed to solve these issues.

The United Ways of Texas ALICE data supplements what was uncovered in the Community Assessment, United Way of Tarrant County said.

The statewide report described ALICE workers.

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“We see ALICE every day – hard workers who keep the Texas economy running. We find ALICE working behind cash registers, serving us in restaurants and retail stores, and caring for our young and elderly. They are our friends, family, and people we rely on every day. Yet they aren’t always sure that they can put food on their own tables or gas in their cars,” the report said.

The inability to afford basic necessities forces families into difficult choices that impact not on the households themselves but also the greater society.

“These decisions often include forgoing health care, high quality child care, healthy food, or car insurance. But these cost-cutting strategies have direct impacts on the health, safety, and future of these households,” the report said.

“The more financially burdened a family is, the more extreme the trade-offs and the risks. These decisions have consequences for the broader communities too, as they inadvertently reduce economic productivity, stress local health care and education systems and raise insurance premiums and taxes for everyone.”

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The report identifies families that have incomes above the Federal Poverty Level (FPL) but whose incomes are not high enough to afford basic household necessities.

“The FPL is an outdated calculation, and it no longer provides accurate information about the number of people facing hardship across the country,” the report said.

ALICE tracks struggling Texas households before and after the Great Recession (2007 and 2010) and then during the recovery through 2016.

Among the findings:

– The cost of basic household expenses in Texas in 2016 was $52,956 for a family of four (two adults with one infant and one preschooler) and $19,428 for a single adult, significantly higher than the FPL of $24,300 for a family of four and $11,880 for a single adult. The cost of the family budget increased by 32 percent from 2007 to 2016.

– Of Texas’ 9,557,706 households, 1,377,013 earn below the FPL (14 percent) and another 2,648,163 (28 percent) are ALICE households. Combined, 42 percent (4,025,176 households) had income below the ALICE threshold.

The report’s numbers for Tarrant County were similar:

In 2016, Tarrant County had 696,887 households with a median household income of $61,534, slightly higher than the state average of $56,565. Of those households, 12 percent were below the FPL comparted to the Texas average of 14 percent and 25 percent qualified as ALICE households compared to the state average of 28 percent. Combined, 37 percent of Tarrant households fell below the ALICE threshold.

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– FWBP Staff