About 14% of New Yorkers fall below the federal poverty line, but the United Way is proposing that another 34% of state residents fall into what they call the "ALICE" category.
To learn more, Capital Region Bureau Chief Grant Ashley spoke to Claire Reid from the United Way of the Greater Capital Region about who is an "ALICE" and what the category means for efforts to fight poverty.
INTERVIEW TRANSCRIPT
Editor's note: this conversation has been lightly edited for clarity.
Ashley: What does ALICE stand for, and what do the New Yorkers in that category have in common?
Reid: So, ALICE is an acronym, and it stands for Asset Limited, Income Constrained, Employed. And we believe that this is a measure that more accurately depicts a comprehensive and unbiased picture of financial hardship, and this looks in particular at those who are earning above the federal poverty level, that 14% you referenced, but not earning enough to make a very minimal budget of essentials. So this gives us a better understanding of just how many people are struggling financially. The federal poverty level is very outdated and does not take into account, for example, geographic differences or the differences in household composition. Anyone with young kids knows childcare is more expensive for an infant than it is for an older child. So the ALICE measure takes into account those differences in household composition and geography, and is updated more regularly to reflect, I think, what we're all feeling, which is the the rising costs of living.
So, what ALICE have in common: they are really the backbone of our state. They are your teaching assistants, the folks working in the grocery stores, bank tellers, TSA workers, people in the healthcare industry, people in the nonprofit sector — really, in every sector. The other thing that ALICE share in common is that, because they earn above the federal poverty level, they are generally ineligible for a lot of public benefits, whose eligibility is tied to being at or below the federal poverty level. So this means you don't earn enough to cover your basics, but you can't lean on the benefits programs that are meant to help you make those ends because you're deemed to earn, you know, "too much money." So what the ALICE framework really demonstrates is that ALICE families who aren't able to make that basic budget, it's not a budgeting problem. It's simply that their earnings don't add up to what it costs to live in this state, or frankly, in most places in the country.
Ashley: I did kind of want to get a little regional here with it. Our radio station covers the Capital Region, the Adirondacks, the Hudson Valley. You know what does being an ALICE family or an ALICE individual look like in those places?
Reid: So thank you for drawing that out, because oftentimes when we share that 48% of New York State is ALICE, we hear like, 'Well, that's a New York City problem,' and it's actually a whole state problem. 36% of the Capital Region is ALICE, and if you dive in deeper, one of the wonderful things about the ALICE tools and the data is that you can actually look at census tracts or legislative districts or zip codes, and there you can see that, in fact, in some zip codes, the ALICE percentage is as high as 66%.
Ashley: I was looking at the data, and there's no county that was affordable for a single-parent with one kid, or a family of four with two minimum wage incomes. But some counties were affordable for a two-parent household with one child or a single adult at minimum wage. What do those more affordable counties have in common?
Reid: Yeah, I'm not sure. I mean, I think there's a lot of different pieces at play there that make a different place more affordable. I certainly think housing is one of the number one drivers of lack of affordability, availability of affordable housing, and also availability of quality-paying jobs in a particular region, especially ones that maybe folks don't have to travel really far for. Transportation is also a big piece of the ALICE budget. So, what makes a particular place affordable is looking at all those cross sections in the budget and saying: Is there childcare available in that particular county? Are there childcare subsidies available? Is there public transportation? That's always a huge boon. What's the access to food look like?
The other thing that can help your dollars stretch, is a thriving impact sector or nonprofit sector that offer a lot of different programs that are available to folks that people can tap into. So then the the benefits piece is critical because when a family or an earner increases their wages, this is a great thing, but unfortunately, because of how a lot of our public benefits are structured, folks then lose what public benefits they may have had. And this is what is called a benefits cliff: The idea that as your earnings increase, your benefits decrease, and this can make it too expensive sometimes for an earner to take that raise or to take that promotion because the value of what they might lose is much higher than what they are earning in that promotion.
Ashley: And then I did want to talk about how this intersects with different groups of people. One thing that kind of stood out to me is more and more seniors have fallen below the ALICE line over the last 15 years. Why is that?
Reid: In part, it's because seniors are on a fixed income, and the cost of living continues to rise, but their benefits are not continuing to rise on pace and on par. So that makes it incredibly more expensive for seniors to live in in a given place.
Ashley: And then your report also noted that Black and Hispanic households and single-parent households that were headed by women were relatively more likely to fall into that ALICE category. Can you talk about kind of the role of gender and race here as it relates to income?
Reid: Yes, so there are ALICE in every single race and gender demographic and age, but the numbers are disproportionately represented among some parts of our community. So, 66% of Black households are ALICE, and 65% of Hispanic households. And this really shows the longstanding interplay between racism and poverty. A while back, the Times Union did a study on redlining in the City of Albany, and the map of redlining in the City of Albany is almost exactly the same as the map in the City of Albany of the highest percentages of ALICE households.
I think also we see because certain professions where there are disproportionate numbers of folks who identify as Black or Hispanic — and this I would go also with gender — that pay less. So if you look at the top 20 professions in the ALICE report, many of those have large percentages of Black, Hispanic and women working in them. For example, the childcare industry: a lot of Black and brown women, and white women, work in that industry, and it is almost exclusively ALICE. And we see in the data that women are still earning less than men for the same jobs.
Ashley: I did want to turn to the policy solutions angle of this conversation. I do want to kind of open it up generally, but I was interested in asking more about that benefits cliff you were talking about. I think if you ask most Americans, 'What is the point of the social safety net?' I think a lot of people would tell you it's supposed to be temporary. But if taking that promotion is going to set you back financially, that kind of makes it financially not viable for you to take that promotion and work your way up, like people are expected to do. So, what's kind of the policy solution to that? How do you make it so that people can take that promotion or can take that new job?
Reid: Well, I think what we've seen in other parts of the country is more of an off-ramp of benefits rather than a cliff. So, as your earnings rise, maybe there's a proportionate decrease in the benefit rather than, you know, zero. And a longer off-ramp. In some instances, families that are just earning that [survival budget], they don't have savings, they don't have any additional money for sort of unexpected emergencies. So an off-ramp would be a better policy choice, in my opinion, because then people can gradually amass enough money to both pay their costs, which they're already not meeting, and have savings.
I think that's the really important piece here: sometimes with some of our policies, there's the assumption made that people are not working or they're not working hard enough. But what the ALICE data shows is that people are working, and sometimes they're working two or three jobs. It's just that the earnings don't add up, so the benefits are actually a needed part of their net resources, as opposed to like an extra that helps them in a particular given moment.
And I think one of the other big policy wins was, last year, the expanded Empire State Child Tax Credit. So this was a huge win and a really wonderful initiative of the state that got rid of the income phase-ins. So this is money that families are able to get back and then invest in their families and in themselves in really important ways. One example: a couple years ago, we had a family that was living in a shelter, they were working, they had enough money to pay the monthly rent, but they did not have any savings to pay the down deposit. And with their earned income tax credit, the dollars that they received back, they were able to pay that deposit and then move out into the apartment that they had found.
I think you know the other one was universal free school meals. That was a win from last year. Summer is when nutritional insecurity is at its highest because families who can rely on the schools for breakfast and lunch during the school year lose that support during the summer.
Another example of a win was sort of looking again at the the governor moving towards how we achieve universal childcare. This is huge. Childcare is one of the largest budget items on a family's budget. It's both a supply and a demand problem. Because we see a lot of childcare workers are also ALICE, it can be difficult for them to stay in that job.
There's no one policy decision that can solve the ALICE problem in one fell swoop. It's really a lot of different policy decisions that look at both reducing the cost as well as increasing their net resources. And this is really an all of us challenge, you know, employers can do a lot to also support their ALICE employees. It's not just a government problem.
I guess the other thing on on the policy front is just New York State's in a difficult position, as are many states, with the changes that are resulting from HR One. We're seeing millions of families losing health coverage, millions of families losing SNAP, you know, this is a really complicated challenge. How do we address both things at the state level, but then also the state will lose a lot of funding that they received prior to support families from federal dollars? So it's a very tricky time.
