The number of families considered to be among the “working poor” in Rock County has continued to march upward, according to a new United Way report on poverty.
In Rock County, 42 percent of all households were either in poverty or at risk of not being able to meet financial burdens despite having people in those households who are working.
That’s according to data from the ALICE Project, a national report the United Way releases every two years to count the number of financially struggling households.
The acronym ALICE stands for “asset limited, income constrained, employed.” The ALICE report measures a household’s ability to meet costs of living based on a designated minimum monthly budget for five basic necessities: housing, child care, food, transportation and health care.
The report, which was released this week, is based on 2016 data that show 31 percent of Rock County households meet criteria of ALICE households. That means that while the households might have one or more people working, they are considered among the working poor—those at continued risk of not being able to meet minimum costs of living.
According to the report, 19,814 households in Rock County are considered ALICE households. The city of Janesville accounts for 7,647 of those households.
That’s a 27 percent increase from the 15,500 ALICE households identified in 2014, according to the report.
ALICE households, according to United Way, have incomes that are too low to meet their minimum needs but too high to meet federal poverty guidelines.
The report shows that an additional 11 percent of households in Rock County meet federal poverty guidelines, a designation applied to those under more dire financial strain than ALICE households. That’s an improvement from the ALICE report two years ago that showed 13 percent of Rock County households met the federal poverty threshold.
How can abject poverty be on a downward trend, yet the ranks of the working poor continue to grow?
Mary Fanning-Penny, president and CEO of United Way Blackhawk Region, said it’s a case of a growing number of families who work jobs with stagnant wages—and don’t earn enough to bridge the gap between their take-home pay and the rising cost of living.
“Many families continue to fight through low wages and depleted savings and the increased cost of living,” Fanning-Penny said. “I think those in the ALICE population, unfortunately, are one crisis or one unanticipated event away from hardship or catastrophe.”
Using a uniform set of “minimum” living costs, the ALICE report calculates that in 2016, a Rock County family of four needed an annual household salary of $65,352—or $32.64 per hour—to afford minimum housing, food, child care and medical bills, among other costs.
But the report shows that across Wisconsin, most jobs pay less than $20 per hour; some pay $15 an hour or less. In Rock County, Fanning-Penny indicated, data show more than 60 percent of households earn less than $20 an hour.
Fanning-Penny said under such trends, it’s “disheartening” yet unsurprising that about a third of Wisconsin families have financial instability that puts them within “ALICE” thresholds.
According to the report, a higher proportion of black and Hispanic households in Rock County are unable to meet their needs compared to white households—although 39 percent of white households here are either considered ALICE households or in poverty.
Fanning-Penny said a leading cause of poverty here is a lack of affordable housing—particularly for those of modest means who are at risk of financial instability.
Over the last year, United Way Blackhawk Region has funneled $1.09 million to programs that fight financial instability, she said. One such program, Janesville social service agency ECHO’s “Way Home,” is a rent assistance service that targets people who are experiencing homelessness.
Those enrolled in “Way Home” must complete job training and personal budgeting programs, and they must hold steady employment.
The ALICE report doesn’t show 2018 data for poverty, but Fanning-Penny said the United Way’s 211 Helpline—a call center for people who face short-term financial crises—is seeing increased use by area residents.
In the first and second quarters of 2018, she said, the 211 line took 1,540 calls, mostly from families experiencing hardships paying for housing, electricity, heating and food. That’s up from 1,349 calls during the same period in 2017.
“That tells me that families who are on ALICE, maybe on a regular occurrence, are making tough decisions” about which bills they can skip to pay others that might be more pressing, Fanning-Penny said.