United Way NCA Launches Inaugural ALICE Reports for the National Capital Area
May 02, 2023
INAUGURAL ALICE IN THE CROSSCURRENTS REPORT GIVES A TRUE PICTURE OF THE NEARLY 500,000 NATIONAL CAPITAL AREA HOUSEHOLDS EMPLOYED AND EARNING ABOVE THE FEDERAL POVERTY LINE YET UNABLE TO AFFORD THE BASIC NECESSITIES
Deloitte Health Equity Institute First to Join United Way NCA’s Journey Towards Reducing the Number of ALICE Households with $500,000 Contribution to Help Address Health Disparities
WASHINGTON, DC (May 2, 2023) — United Way of the National Capital Area (United Way NCA) in partnership with United for ALICE today released its new report, ALICE in the Crosscurrents (ALICE Report), which sheds light on the financial hardship of the nearly 500,000 households in the National Capital Area who are working yet cannot afford the basics in the communities where they live.
ALICE, a United Way NCA acronym for Asset Limited, Income Constrained, Employed, represents the growing number of individuals and families working but unable to afford basic necessities, such as food, healthcare, childcare, transportation expenses and more. The ALICE Report integrates the ALICE population across the DC Metro Area with disaggregated County level data in the National Capital Area. The reality is that 664,711 households in the National Capital Area – 33% – had income below the ALICE Threshold or minimum income level necessary for survival for a household. That calculation includes the 176,744 households at or below the Federal Poverty Line (FPL) and another 487,967 families defined as ALICE. Nationwide,16.2M households are at or below the FPL and another 36.3M are ALICE.
“What we’re seeing is a mismatch between earnings and the increasing cost of basic necessities,” said Rosie Allen-Herring, President and CEO, United Way of the National Capital Area. “ALICE families have been overlooked and undercounted by traditional poverty measures. While the FPL is updated yearly, the Census Bureau determines poverty status using Thresholds dating back to 1963. The antiquated Federal Poverty Line, the fact that ALICE households may not qualify for federal benefits or safety nets, and the increased cost of living over time as inflation continues to rise, all contribute to the growing number of ALICE households.”
Every two years, United Way NCA releases an ALICE report that provides data on where ALICE lives in the region, who they are, and more. Until now, in this region, these reports were only available in the states of Maryland and Virginia, but for the first time, Washington, DC is included in the 2023 report, which enables United Way NCA to provide a true picture of ALICE and critical information that can help guide efforts in uplifting all National Capital Area residents. It helps reshape how United Way NCA and its partners understand regional financial hardships and the ongoing challenges many community members face today. Racism, discrimination, and systemic barriers limit families’ access to resources and opportunities for financial stability.
ALICE is the nation’s childcare workers, home health aides and cashiers heralded during the pandemic – those working low-wage jobs with little or no savings and one emergency from poverty. Daily they are faced with making difficult decisions on whether to spend their earnings on healthcare or food. ALICE may be your neighbor, your colleague, your friend or even a family member.
According to the ALICE in the Crosscurrents: COVID and Financial Hardship report, an ALICE Household Survival Budget for a family of four in the National Capital Area in 2021 was $101,281, well above the FPL at $26,500 and well above the full-time earnings for most low-wage jobs in the region. The ALICE Household Survival Budget for ALICE shows how earnings are stretched thin and insufficient to meet the minimum monthly household expenses of those employed.
For example, in the National Capital Area, a retail salesperson (one of the most common occupations) earned an average hourly wage of $14.21, short of the $23.81 hourly wage needed to meet the ALICE Household Survival Budget for one worker employed full-time, much less for a family with children. Moreover, of the 2 million households in the National Capital Area, more than 84% are located outside the District. As a result, many ALICE workers live outside the District, where housing is less expensive but adds the costs of commuting (monthly avg. $250-$550 depending on the household), and extra time to travel, which could contribute to an increase in childcare (already over $2000 monthly with two children in childcare).
The ALICE report revealed the following in each of the three National Capital Area main jurisdictions:
- Washington, D.C. shows that the total number of financially insecure households rose by 16% between 2019 and 2021 – nearly double the 10% increase in the District’s overall population. ALICE households increased by 8,241 during that time. For many families struggling to stay afloat, an additional 10,134 families fell into poverty.
- Maryland Counties (Prince George’s County and Montgomery County) show that the total number of financially insecure households rose collectively by 7.5% between 2019 and 2021 – in line with the 7% increase in the overall population. ALICE households increased by 1,777 during that time. For many families struggling to stay afloat, an additional 17,172 families fell into poverty.
- Virginia Counties (Arlington, Alexandria, Loudoun County, Fairfax County, Prince William County, Rappahannock, Culpeper, Fauquier) show that the total number of financially insecure households fell by 4% between 2019 and 2021 – contrasted to the 3% increase in the area’s overall population. While ALICE households decreased by 8.5% during that time, 15% of families fell into poverty.
For all three regions, public assistance programs were temporarily expanded in 2021, but not enough to bring most households below the ALICE Threshold to financial stability. To illustrate, a family of four with two parents working full time in two of the most common occupations (retail salesperson and cashier) earning a combined $58,500 annually could not afford the Household Survival Budget in 2021–in DC $92,736, Maryland $101,760, and Virginia $101,913–even with the $20,800 in assistance through the expanded Child Tax Credit, the Child and Dependent Care Tax Credit, and the Economic Impact Payments.
While job disruptions and inflation delivered significant financial pain, a combination of pandemic support and rising wages did help to blunt what could have been a deeper financial crisis, the report finds. However, as some benefits are peeled back and inflation persists, signs of greater financial stress are on the horizon.
Additional report insights include a clearer outlook on the disparities impacting Black and Brown communities, seniors 65+, single-other households, food insecurity, healthcare, and education:
- Black & Brown Households: In the National Capital Area, 47% of Black households (nearly 1 in 2) are below the ALICE Threshold. For example, in DC alone 28% are ALICE and with 41% living in Wards 7 & 8 representing 71% Black & 50% Hispanic households disproportionately below the ALICE Threshold compared to 14% White households.
- Families with Children: In the National Capital Area, 64% of female-headed households with children are below the ALICE Threshold. In DC, 79% of female-headed households with children are below the ALICE Threshold.
- Food Insecurity: Of the 136,544 households in the National Capital Area receiving SNAP benefits in 2021, 63% earned at or above the Federal Poverty Line, categorizing them as ALICE. According to the ALICE Household Survival Budget, a family of four in DC needs $1,562 monthly to afford a healthy, practical diet; however, the maximum monthly SNAP benefit for a family of four is $939 and the average is $684. By race, in the National Capital Area, 43% Black, 26% Hispanic and 16% White households are food insecure and 80% are Low Income*
- Healthcare Disparities: Households below the Threshold in D.C., Maryland, and Virginia were more likely than those above the Threshold to incur an unexpected major medical expense that they had to pay for out of pocket because it was not completely paid for by insurance (19% vs. 15% in November 2021). On average, 56% of households below the ALICE Threshold in the National Capital Area are more likely than those above the Threshold to incur an unexpected major medical expense of $1000 or more that they will have to pay for out of pocket due to insufficient coverage. Additionally, in the fall of 2021, D.C. households below the ALICE Threshold were more likely to report that they missed, delayed, or skipped their child’s preventive check-up in the last 12 months than households above the Threshold (39% vs. 11%).
- Education: Across the National Capital Area, 48% of students enrolled in K-12 schools are economically disadvantaged, negatively impacting overall attendance and ultimately high-school graduation rates. In DC in 2021, 39% of all households with children are below the ALICE Threshold.
“At United Way NCA our goal is to reduce disparities across all three pillars of health, education and economic opportunity and improve outcomes for individuals and families in the National Capital Area, particularly for our ALICE population,” added Allen-Herring. “We cannot do this work alone, so we’re calling on community organizations and partners to join us. We know that collectively we could make great strides to reduce ALICE households in our region. We are grateful to Deloitte for their $500,000 investment and commend them for being the first to join us on the journey.”
“The Deloitte Health Equity Institute is excited to build on our strong existing relationships with United Way both nationally and locally to address racial health disparities and gaps in care for the most vulnerable. DHEI’s commitment to United Way NCA reinforces our dedication to invest in place-based initiatives that create meaningful impact and build trust and confidence in a more equitable society. Our hope is that our contribution will be a catalyst to advance health equity at scale and invites others to join us,” said Jeremy Blank, Greater Washington Area Managing Partner, Deloitte LLP. “Deloitte is providing $500,000 to help expand United Way’s Thrive United 365 Program as a part of its $1.5b social impact investment to support individuals and communities facing the greatest barriers to social and economic prosperity. Thrive United 365 helps to bridge the gap in health disparities disproportionately impacting the Greater Washington community.”
The ALICE in the Crosscurrents for United Way NCA was funded by Greater Washington Community Foundation and Kaiser Permanente. To read the report and access online, interactive dashboards that provide data on financial hardship in the National Capital Area, visit unitedwaynca.org/alice.
About United Way of the National Capital Area
United Way of the National Capital Area works to improve the health, education and economic opportunity of every person in the region. United Way NCA has been improving lives by creating measurable impact in the District of Columbia, Northern Virginia, and Montgomery and Prince George’s Counties for nearly 100 years. In 2020, United Way NCA was among 384 organizations across the United States to receive a generous transformational investment from novelist and venture philanthropist, MacKenzie Scott. For more information about United Way of the National Capital Area, visit UnitedWayNCA.org.
About United For ALICE
United For ALICE is a driver of innovation, research and action to improve life across the country for ALICE (Asset Limited, Income Constrained, Employed) and for all. Through the development of the ALICE measurements, a comprehensive, unbiased picture of financial hardship has emerged. Harnessing this data and research on the mismatch between low-paying jobs and the cost of survival, ALICE partners convene, advocate and collaborate on solutions that promote financial stability at local, state and national levels. This grassroots ALICE movement, led by United Way of Northern New Jersey, has spread to 27 states and includes United Ways, corporations, nonprofits and foundations in Arkansas, Connecticut, Delaware, Florida, Georgia, Hawai‘i, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Mississippi, New Jersey, New York, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Virginia, Washington, Washington, D.C., West Virginia and Wisconsin; we are United For ALICE. For more information, visit: UnitedForALICE.org.
About Deloitte Health Equity Institute
Recognizing the imperative for immediate and sustained effort, and grounded in Deloitte’s acknowledgment of racism as a public health crisis, Deloitte established the Deloitte Health Equity Institute (DHEI) in spring 2021. DHEI is dedicated to creating public good through community collaboration and investment, data and analytics, and knowledge development. DHEI builds on Deloitte’s commitment to advance health equity, informed by work with clients, a decade of impact made by the Deloitte Center for Health Solutions, and our perspective on how life sciences and health care organizations can activate health equity. The DHEI reinforces our purpose of making a positive, enduring impact that matters. By collaborating with local and national organizations, DHEI is a catalyst, helping advance health equity at scale. Our initiatives aim to help everyone achieve their full potential in all aspects of health and well-being, building a more equitable society for all. Please see www.deloitte.com/us/about for a detailed description of our legal structure.