ALICE: The Consequences of Insufficient Household Income
ALICE households live in every town and county throughout the states included in the United Way ALICE Project. The research shows that ALICE households are made up of men and women of all races and ethnicities, young and old, living in urban, suburban, and rural areas.
What also emerged from the research was a pattern of coping strategies that families employ when they do not have enough income or assistance to afford basic necessities. When looked at as a whole, these strategies tell us a great deal about the problems in our communities, and the challenges that families and communities face in developing solutions:
• Most obviously, the extent of hardship – with 40 percent of households earning below the ALICE Threshold – means that millions of families are being forced to make difficult choices and risky trade-offs on a day-to-day basis.
• The struggle, the risks, and those difficult choices are stressful and taxing for these families, their employers, and their communities. These situations lead not to advancement, but to worse outcomes. And not being able to support one’s family even with hard work causes frustration and increasing distress.
• The problems are complicated and interwoven. Inadequate housing, child care, food, transportation, and health care create safety risks and health risks to all members of a community, not just ALICE.
For solutions to be effective, they must be as comprehensive and interconnected as the problems are. Siloed solutions do not work. Policy makers should consider the following:
• Jobs. Higher wages, more hours, or both would mean more ALICE workers could better support their families and be more engaged in their communities. The means to achieve higher wages range from raises in current jobs to new job opportunities, which may require training in new skills. Additional work hours may also demand different work schedules, better transportation, or additional child care to support increased productivity.
What also emerged from the research was a pattern of coping strategies that families employ when they do not have enough income or assistance to afford basic necessities. When looked at as a whole, these strategies tell us a great deal about the problems in our communities, and the challenges that families and communities face in developing solutions:
• Most obviously, the extent of hardship – with 40 percent of households earning below the ALICE Threshold – means that millions of families are being forced to make difficult choices and risky trade-offs on a day-to-day basis.
• The struggle, the risks, and those difficult choices are stressful and taxing for these families, their employers, and their communities. These situations lead not to advancement, but to worse outcomes. And not being able to support one’s family even with hard work causes frustration and increasing distress.
• The problems are complicated and interwoven. Inadequate housing, child care, food, transportation, and health care create safety risks and health risks to all members of a community, not just ALICE.
For solutions to be effective, they must be as comprehensive and interconnected as the problems are. Siloed solutions do not work. Policy makers should consider the following:
• Jobs. Higher wages, more hours, or both would mean more ALICE workers could better support their families and be more engaged in their communities. The means to achieve higher wages range from raises in current jobs to new job opportunities, which may require training in new skills. Additional work hours may also demand different work schedules, better transportation, or additional child care to support increased productivity.
• Assistance. Public and nonprofit assistance – especially child care assistance, EITC, SNAP, Medicaid, SSI, and TANF – already makes a big difference for many ALICE and poverty-level families. There are limits to the effectiveness of assistance, however. Not all struggling families can access benefits due to eligibility limits and work requirements that have not kept pace with the changing landscape of jobs, schedules, and household costs. In addition, most assistance is not flexible enough to address emergencies; for example, a family cannot use food subsidies to pay an unexpected medical bill.
• Crime and incarceration. Most households in the U.S. play by the rules, but in all income tiers, a small number break the law for financial gain. For a few families with very limited financial options, that behavior can take the form of selling SNAP benefits or even drugs for cash in order to afford rent and utilities. The consequences of arrest and fines are particularly severe for low-income households, especially those without the means to pay fees or hire a lawyer, and the consequences of incarceration and a criminal record add barriers to future earning ability and eligibility for public assistance that all but ensure longer-term hardship (Moore, 2013; Stevenson, 2016; Kearney & Harris, 2014). In weighing the costs and benefits of policy changes that would help ALICE and poverty-level households, the costs of crime, incarceration, and re-entry are sometimes a part of the equation.
• Crime and incarceration. Most households in the U.S. play by the rules, but in all income tiers, a small number break the law for financial gain. For a few families with very limited financial options, that behavior can take the form of selling SNAP benefits or even drugs for cash in order to afford rent and utilities. The consequences of arrest and fines are particularly severe for low-income households, especially those without the means to pay fees or hire a lawyer, and the consequences of incarceration and a criminal record add barriers to future earning ability and eligibility for public assistance that all but ensure longer-term hardship (Moore, 2013; Stevenson, 2016; Kearney & Harris, 2014). In weighing the costs and benefits of policy changes that would help ALICE and poverty-level households, the costs of crime, incarceration, and re-entry are sometimes a part of the equation.