Friday, May 18, 2018

Suffering Americans

The United Way’s ALICE project released a study showing, “Nearly 51 million households don’t earn enough to afford a monthly budget that includes housing, food, child care, health care, transportation and a cell phone.”

These numbers include both the 16.1 million families living at or below the federal poverty line (currently $24,600 for a family of four) and the 34.7 million families the United Way calls ALICE, or Asset Limited, Income Constrained, Employed. This means people who earn too much to qualify for federal poverty programs but are still unable to cover their monthly expenses nationwide - 43% of Americans cannot afford basic needs.

The severity of the problem varies by state. California, New Mexico and Hawaii have the highest number of struggling families, at 49 percent. By contrast, North Dakota has the lowest, at 32 percent. 

The financially struggling families represent “… the nation’s child care workers, home health aides, office assistants and store clerks, who work low-paying jobs and have little savings. … Some 66% of jobs in the US pay less than $20 an hour.”

More low-wage jobs may decrease the unemployment rate, but employment doesn’t mean families can pay their bills.  Stephanie Hoopes, a founding author of the study, explained this frustration, explaining that “the rate of inflation in the past 10 years has been about 9 percent, but the cost of living for ALICE families has risen by nearly twice that.” As a result, she explained, “There’s a sense of frustration or even anger because people are being told that they’re doing better but they aren’t.”

According to the Federal Reserve’s Survey of Consumer Finance, the top 1 percent of wealthy Americans now holds 38.6 percent of the nation’s wealth, up from 33.7 percent in 2007. The bottom 90 percent of Americans had only 22.8 percent of the nation’s total wealth in 2017, down from 28.5 percent in 2007.

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