33 Percent Of Florida Households Face Financial Ruin

TAMPA, FL — When the coronavirus pandemic hit, nearly 2.6 million Florida households were one emergency away from financial ruin — a 10-year record high — setting the stage for the unprecedented economic impact of the crisis.

That's according to the state’s latest ALICE (Asset Limited, Income Constrained, Employed)Report released by the United Way in partnership with United For ALICE.

Over the last decade, Florida’s low-income families systematically lost buying power and financial stability as the high cost of essentials outpaced wages, driving the number of ALICE households to rise 66 percent by 2018, said the report.

“We’ve known that our economy was increasingly reliant on these families we call ALICE, who are financially vulnerable to one emergency,” said United Way Suncoast CEO Jessica Muroff. “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.”

In 2018, of Florida’s 7.8 million households, nearly 2.6 million were ALICE, a record number that were unable to afford the basics for survival despite working. That’s in addition to the one million families that were in poverty. While wages for ALICE workers remained largely stagnant, the cost of six essentials grew on average 3.4 percent annually over the past decade. That’s in contrast to a rate of inflation of 1.8 percent.

As a result, ALICE households grew to account for 33 percent of Florida’s households in 2018, up from 22 percent in 2007. In contrast, poverty levels remained largely flat at about 13 percent. The report shows ALICE households were locked out of the boom economy and unable to establish savings due to meager pay raises and inconsistent job hours, schedules and benefits.

Percentage of households meeting or below the ALICE threshold:

• Calhoun County, 45 percent
• Pinellas County 33 percent
• Hillsborough County 29 percent
• Pasco County 35 percent
• Hardee County 41 percent
• Osceola County 42 percent
• Miami-Dade County 39 percent
• Manatee County 32 percent
• Sarasota County 30 percent
• Polk County 33 percent
• Broward County 38 percent
• Palm Beach County 35 percent
• Orange County 32 percent
• Alachua County 33 percent
• Charlotte County 34 percent

“No matter how hard ALICE families worked, the gap between their wages and the cost of basics just kept widening,” said Muroff. “These already-fragile ALICE households are now facing an even deeper financial hole due to the state of emergency created by COVID-19.”

A Financial Hardship Study shows that the cost of survival ranges annually from $24,600 for a single adult, to $27,348 for a senior citizen and $69,516 for a family of four with an infant and a preschooler.

Putting this in perspective, the median hourly wage in Florida amounts to $22,040 a year. 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 $17.38 an hour to afford the Household Survival Budget for a family of four. That’s up from a wage of $11.93 an hour in 2007. During the same period, the number of low-wage jobs grew by 69 percent, accounting for the majority of all jobs in Florida.

“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. “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.”

Muroff said the report’s findings can be used to identify state and local organizations that address the unique challenges the coronavirus pandemic has posed on ALICE families as businesses and schools remain closed indefinitely.

The report calls for stakeholders across all sectors to use its findings to remove obstacles to financial stability, identify gaps in community resources and build data-driven solutions to help ALICE families achieve economic stability, bolstering the state’s economy overall.

United For ALICE is a grassroots movement of 650 United Ways in 21 states, corporations and foundations. ALICE Reports provide county-by-county and town-level data and analysis of how many households are struggling, including the obstacles ALICE households face on the road to financial independence.