FOR IMMEDIATE RELEASE: September 7, 2020
COVID-19 Hit as Record Number of ALICE Families
Were Priced Out of Survival
United Ways of Tennessee Releases Pre-COVID-19 Report
and Launches Statewide Impact Survey
Murfreesboro, Tennessee — When COVID-19 hit, more than 800,000 Tennessee households were already one emergency away from financial ruin — a 10-year record high — setting the stage for the unprecedented economic impact of the crisis, according to the state’s latest ALICE Report, released today by United Ways of Tennessee, in partnership with United For ALICE. ALICE stands for Asset Limited, Income Constrained, Employed and represents households that are working but cannot afford the basic necessities of housing, food, child care, health care, transportation, and a smartphone. To read a copy of the report and find county-by-county and town-level data on the size and demographics of ALICE as well as the community conditions and costs faced by ALICE households, visit https://uwtn.org/alice.
This latest Tennessee ALICE Report paints the picture of a crisis in the making with an 85% increase in our state’s ALICE households over 10 years, fueled by high-priced basics and stagnant wages. With this data in hand on where families were prior, United Ways of Tennessee is launching a COVID-19 Impact Survey to better understand the effects of the pandemic on households. The survey can be accessed through end of September at: https://unitedwaynnj.iad1.qualtrics.com/jfe/form/SV_74CF5MumkY467OJ
“We’ve known that our economy was increasingly reliant on these families we call ALICE, who are financially vulnerable to one emergency,” said Mary Graham, president of United Ways of Tennessee. “COVID-19 became that one universal emergency. ALICE families are facing the greatest health and financial risks today, as they are the workers who don’t have health insurance, have no paid sick days, and whose children receive daily meals at school. We encourage all Tennesseans to complete this survey.”
“No matter how hard ALICE families in our community worked, the gap between their wages and the cost of basics just kept widening,” said Meagan Flippin, President and CEO of the United Way of Rutherford and Cannon Counties. “These already fragile ALICE households are now facing an even deeper financial hole due to the state of emergency created by COVID-19.”
“We want all in our community to complete the survey,” Flippin said. “This data will help us identify trends and needs, and enable United Way to work with our partners and stakeholders to provide resources and support for ALICE families during this difficult time.”
In 2018, of Tennessee’s 2.6 million households, more than 800,000 were ALICE-- a record number that were unable to afford the basics for survival, despite working. That’s in addition to the almost 400,000 households that were in poverty. While wages for ALICE workers remained largely stagnant, the cost of six essentials grew on average 3.4% annually the past decade. That’s in contrast to a rate of inflation of 1.8%.
ALICE in Tennessee: A Financial Hardship Study shows that in 2018, the cost of survival ranged annually from $23,064 for a single adult, to $25,716 for a senior citizen and $65,040 for a family of four with an infant and a preschooler. Putting this in perspective, the median hourly wage for a retail salesperson, the most common occupation in Tennessee, was $11.09, or $22,180 per year — less than all the budgets.
This mismatch between wages and costs is revealed by a new measurement debuting in this report, called the ALICE Essentials Index. This 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 $16.26 an hour in order to afford the Household Survival Budget for a family of four. That’s up from a wage of $10.23 an hour affording that budget in 2007. During the same period, the number of low-wage jobs nearly doubled (up 113%).
“The ALICE Essentials Index shows that, through no fault of their own, ALICE families have been priced out of economic stability, setting the stage for the scope of this crisis,” said United For ALICE National Director Stephanie Hoopes, Ph.D. “Using the Consumer Price Index alone to measure inflation provides an incomplete picture of the cost of living, severely underestimating the mounting financial pressures on ALICE families.”