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Groundbreaking study reveals 2 in 5 Summit County households struggle to afford basics

Oct 04, 2017

There are more than 85,000 households in Summit County unable to afford the state’s cost of living, with conditions still lagging behind pre-recession levels, according to the United Way ALICE Report released today by Ohio United Way. The report is the most comprehensive depiction of financial need in the state to date, using the latest data from a variety of sources, including the U.S. Census. It unveils new measures – based on present-day income levels and expenses – that quantify the size of who in Ohio’s workforce is struggling financially, and why.

The United Way ALICE Report – ALICE stands for Asset Limited, Income Constrained, Employed – places a particular spotlight on the large population of Summit County residents who work at low-paying jobs, have little or no savings and are one emergency from falling into poverty.

A total of 1.2 million Ohio households fall into what United Way calls the ALICE population. These households earn more than the official U.S. poverty level, but less than the basic cost of living – a number that is nearly double the official poverty rate. In Summit County alone, more than 55,000 households are part of the ALICE population. Another more than 30,000 Summit County households live below the poverty level. Combined, ALICE and poverty households, account for two out of every five households in both Ohio and Summit County and more than half of all households in Akron.

The study’s revelations are of particular significance to United Way of Summit County as it works toward its Bold Goals for 2025. For its Bold Goal 3, United Way of Summit County is working to financially empower 11,000 of Summit County’s working poor – the same population highlighted in the Ohio ALICE Report.

In 2018, United Way of Summit County will launch its Financial Empowerment Centers – developed in partnership with the City of Akron – which will bring financial stability to the neighborhoods that need it most. With the help of a trained financial advisor, visitors will learn to build assets, reduce debt, raise credit scores, budget for the future and access safe and affordable banking services.

United Way of Summit County and Ohio United Way have joined a grassroots movement of some 450 United Ways in 15 states to use the same methodology for documenting financial need. Building on a United Way study first developed in New Jersey, United Way ALICE Reports provide county-by-county and town-level data. They provide analysis of how many households are struggling, including the obstacles ALICE households face on the road to financial independence.

“This report uses hard data to paint a picture of the lives of those struggling to get by in our community,” says Summit County Executive Ilene Shapiro. “It helps us understand the needs that they have and challenges they face. That makes it a valuable tool for those of us serving in government, who count on accurate information to guide public policy decisions that can effectively promote financial independence.”

The United Way ALICE Report reveals:

• More than 67% of all jobs in Ohio pay less than $40,000 a year and low-income jobs are projected to dominate the state’s economy for the foreseeable future.

• Households with income below the ALICE Threshold make up 40 percent of households in Summit County and 57 percent of households in Akron.

• 70% of Ohio’s 1,568 county subdivisions have 30 percent or more households unable to make ends meet. The average income needed in order to survive in Ohio depends on local conditions and ranges from $55,000 to $66,000 annually for a family of four, more than double the official U.S. poverty rate.

• Despite the combination of employment income and some public assistance, ALICE households still face a 40 to 50 percent income gap in housing and child care, further hindering their attempts to reach financial stability.

“We all know ALICE,” says Jim Mullen, president and CEO of United Way of Summit County. “ALICE is the recent college graduate who struggles to pay her rent. It’s the young family straining under the rising cost of child care. It’s the single dad who faces the choice between buying groceries for his family and repairing his car so that he can get to work. The United Way ALICE Report shows that these people make up a significant portion of our community, and their economic future is the economic future of Summit County as a whole.”

Ohio United Way, along with United Way of Summit County and 45 other local United Ways funded the ALICE Report for Ohio. Nationally, the United Way ALICE Report has been funded in part by corporate sponsors including the Aetna Foundation, AT&T, Atlantic Health System, Deloitte, Entergy, Johnson & Johnson, KeyBank, Novartis Pharmaceuticals Corporation, OneMain Financial, Thrivent Financial Foundation, The UPS Foundation and U.S. Venture.
 

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