August 2020
ALICE Data for Michigan
Poverty and racism have been inextricably connected since this country’s inception, yet official federal statistics have never fully portrayed the economic impact of that link. United For ALICE was founded on the need to more accurately measure and track financial hardship nationwide. For more than a decade, our research has been shedding light on the disparity of economic opportunity that exists in every state. The data show that while hardship is pervasive, the history of slavery and its ongoing legacy of systemic and institutional racism stigmatizes Black households uniquely.
- In Michigan, our analysis of the actual cost of living in every county shows that 40% of all households do not earn enough to cover basic expenses, including housing, child care, food, transportation, health care, and a basic smartphone plan. This gap between wages and the cost of living is a structural economic problem, in Michigan and nationwide.
- Yet for Black households, that number is much higher: 63% of Black households in Michigan are unable to afford basic household essentials in their communities. This is almost three times the rate of hardship shown for Black households by the antiquated and arbitrary Federal Poverty Level (FPL). And it is almost twice the rate of hardship for White households.
- From 2010 to 2018 — which covers the “recovery” from the Great Recession — the number of Black households below the ALICE Threshold (the minimum income needed to afford household basics) increased by 11%, while the number of White households struggling to make ends meet increased by only 1% in Michigan.
About United for ALICE
Who is ALICE?
ALICE (Asset Limited, Income Constrained, Employed) households have income above the FPL but below the ALICE Threshold — the income needed to afford the most basic household budget. ALICE households earn too much to qualify as “poor” but are still unable to make ends meet. They often work as cashiers, nursing assistants, office clerks, servers, laborers, and security guards. These types of jobs are vital to keeping our economy running smoothly, but they do not provide adequate wages to cover the basics of housing, child care, food, transportation, health care, and technology for these ALICE workers and their families. Together with households in poverty, ALICE households represent just over 40% of all households in the U.S.
What is the ALICE Threshold?
The ALICE (Asset Limited, Income Constrained, Employed) Threshold is the minimum income that households need to afford all of their basic needs. It is calculated using actual costs of essential goods and services — housing, child care, food, transportation, health care, and basic technology — in every U.S. county and is adjusted for household composition. This creates a far more accurate picture of needs than the outdated FPL.
Where can I find the data and more information?
To better inform the current crisis on race in Michigan, United For ALICE and the Michigan Association of United Ways is providing a preview of data from our 2020 ALICE Report for Michigan. For more details, visit our website: www.UnitedForALICE.org. For a detailed overview of the ALICE methodology, visit www.UnitedForALICE.org/Methodology.
What is the mission of United For ALICE?
United For ALICE is a center of innovation founded by United Way of Northern New Jersey that is shining a light on the challenges ALICE (Asset Limited, Income Constrained, Employed) households face. Through a standardized methodology that assesses the cost of living in every county, the project provides a comprehensive measure of financial hardship across the U.S. Equipped with this data, ALICE partners convene, advocate, and innovate in their local communities to highlight the issues faced by ALICE households and to generate solutions that promote financial stability. This grassroots movement represents United Ways, corporations, nonprofits, and foundations in Arkansas, Connecticut, Florida, Hawai‘i, Idaho, Illinois, Indiana, Iowa, Louisiana, Maryland, Michigan, New Jersey, New York, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Virginia, Washington, and Wisconsin; we are United For ALICE.