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ALICE sends mixed signals

Poverty in Kent County is decreasing but those living paycheck to paycheck is increasing.

May 3, 2019
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An updated report by United Way shows poverty in Kent County is decreasing, but the number of those living paycheck to paycheck is doing the opposite.

The nonprofit’s latest ALICE report shows that 9% of Kent County households were in poverty in 2017, down 5% from 2014, while the rate of those within the ALICE Threshold increased by four percentage points to 28%.

The ALICE Threshold — which stands for Asset Limited, Income Constrained, Employed — is defined as households with incomes just above the federal poverty level, meaning they often do not qualify for public assistance yet still struggle to afford basic household necessities.

The report shows the budget needed for “bare-minimum survival” — not allowing for saving to offset emergencies or future investment — is $21,624, or $10.81 per hour, for a single adult and $64,788, or $32.39 per hour, for a family of four with two adults and two young children. Still, the adjusted ALICE levels are much higher than the federal poverty level of $11,880 for a single adult and $24,300 for a family of four.

Single-parent families, especially those headed by single mothers, struggle much more than those headed by married couples.

The report attributes the high number of ALICE and poverty households to increased low-paying jobs. Most jobs in each state pay less than $20 per hour, the majority of those paying less than $15 per hour.

These are grocery store checkout workers, servers in restaurants, home health care aides, preschool teachers, hairdressers and many other workers most interact with every day, said Maribeth Groen, marketing manager for the Heart of West Michigan United Way.

She said people in the ALICE Threshold often have to weigh whether they will purchase expensive prescriptions versus food, for example, and other tough financial decisions.

“I think the biggest thing is just breaking down the myths and misconceptions about the families who do need help,” Groen said.

Jennifer Headrick, a management analyst for Kent County, said she has chosen to live in Spring Lake. Even commuting into Grand Rapids every day, she said living in Spring Lake is more affordable.

“I won't be able to find child care, and I won't be able to find an affordable house, so I don't live in Grand Rapids,” Headrick said.

Headrick said she moved from Alaska in 2017 with her 5-month-old daughter. When calling daycare providers, she said her daughter was placed on one- and two-year waitlists, no matter how expensive the providers.

In Kentwood, she said rent for her two-bedroom apartment was $1,300 per month. When she moved to Spring Lake, she said she found a more affordable apartment, and while child care is just as expensive, at about $1,200 per month, she was able to find it more easily.

“It's really nice if you have family members who can help you. But if you don't have that, you can be stuck,” Headrick said.

Shannon Gardner, vice president of community impact for Heart of West Michigan United Way, said she believes landlords hold some responsibility in keeping prices affordable. While she said some understand that way of thinking and keep prices lower, many raise them to match demand.

Gardner said she would like to see more partnerships that allow nonprofits to take the risk so landlords can offer lower prices for underserved communities. She said the United Way and the housing coalition are open to new ideas from landlords and others to work toward solutions.

The United Way is advocating for several policy solutions and recently held a breakfast presentation of the report for legislators.

The solutions include support for the 2-1-1 phone line, which connects those in need with services; removing the barrier to child care; improving early literacy; and strengthening the earned income tax credit.

Gardner said counties aren’t getting the federal dollars she thinks they should to fight for these solutions.

“Funding is becoming very competitive and agencies aren't able to have the impact that they really want to have because they don't have the resources,” she said.

Gardner said she believes the solution lies in collaboration between multiple organizations.

“Our community needs to look at it from the standpoint that not one funder or one foundation can do the work. It's too much. The gap is huge,” she said. “So, how do we come together to figure out who's focusing on what areas and how we can best address the gaps and look at the equity so that it's fair across the board and is meeting people's needs, not just skirting them through the process?”

Michigan Sen. Winnie Brinks attended United Way’s legislative breakfast. As a former nonprofit worker for The SOURCE, which helps clients retain jobs, she said she believes there’s some policy work that can be done to improve the situation.

“It's just really important that we understand how tough it can be for those families and their sense of security, but it also has a huge impact on children in those households, their ability to succeed in school, so it's a lot more expensive than just the issues that face a family that can't pay its bills,” Brinks said.

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