A new study of households in poverty released by the United Ways of Ohio shows that when the COVID-19 pandemic hit, more than 1.1 million Ohio households were already one emergency away from financial ruin — a 10-year record high.
More than 1.1 million of 4.7 million Ohio households were considered ALICE, which stands for Asset Limited, Income Constrained, Employed, according to the report.
A record number of households were unable to afford the basics for survival, despite working, according to the statewide report. That’s in addition to the 646,948 families that were in poverty. ALICE households grew to 39% of Ohio households, up from 31% in 2007 while households defined as in poverty remained largely flat at 14%.
Many workers classified as essential during the COVID-19 pandemic – from grocery store employees to first responders – fall into the ALICE population, making them especially vulnerable to the economic effects of the crisis.
“COVID-19 has taken a toll on everyone in our community, but the Ohioans highlighted by this report are among those paying the highest price during this crisis,” said Jim Mullen, president and CEO of United Way of Summit & Medina. “ALICE families are facing the great health and financial risks. They are the workers who don’t have health insurance, have no paid sick days, whose children receive daily meals at school, and whose jobs have helped our community throughout this pandemic.”
Over the last decade, Ohio’s low-income families systematically lost buying power and financial stability as the high cost of essentials outpaced wages, officials said. While wages for ALICE workers remained largely stagnant, the cost of six essentials grew on average 3.4% annually over the past decade.
That’s in contrast to a rate of inflation of 1.8%.
The report shows ALICE households were locked out of economic growth and unable to establish savings due to meager pay raises and inconsistent job hours, schedules, and benefits.
The ALICE Report for Ohio 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.
The “ALICE in Ohio: A Financial Hardship Study” shows that in 2018, the cost of survival ranged annually from $21,828 for a single adult, to $24,396 for a senior citizen and $67,404 for a family of four with an infant and a preschooler. Putting this in perspective, the median hourly wage for food preparation and serving workers, the most common occupation in Ohio, was $9.31, or $18,620 per year.
This mismatch between wages and costs is revealed by a new measurement debuting in this report, called the ALICE Essentials Index. The 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 $16.85 an hour in order to afford the Household Survival Budget for a family of four.
That’s up from a wage of $12.93 an hour affording that budget in 2007. During the same period, the number of low-wage jobs grew by 5%, accounting for 35% of all jobs in Ohio in 2018.
Here’s a look at how many households in each of the five counties in the Akron region are below the ALICE threshold and a sampling of some highest community levels:
– Medina County: 26% of county; city of Medina 35%, Medina township 22%, Wadsworth 21%
Portage County: 38% of county, city of Ravenna 59%; Windham 61%, Kent 58%
Stark County: 37% of county; Alliance 54%; Canton 58%; Massillon 40%
(Information has been corrected to fix an error. See correction below. 7:10 p.m. Sept. 18)
Summit County: 34% of county households; Akron 52%, Barberton 46%, village of Lakemore 46%
Wayne County: 34% of county; Rittman 47%; city of Wooster 45%; Wooster township 38%
For more information or to find data about ALICE in local communities, visit www.UnitedForALICE.org/Ohio.
Beacon Journal staff reporter Betty Lin-Fisher can be reached at 330-996-3724 or [email protected] Follow her @blinfisherABJ on Twitter or www.facebook.com/BettyLinFisherABJ
CORRECTION: Stark County’s number of ALICE households or those in poverty is 37 percent. It’s 38 percent in Wayne County’s Wooster Township. The rates were incorrect when this story first published.