New report highlights financial burdens faced by many Louisiana families in 2023

MONROE, La. (KNOE) - Between the COVID-19 pandemic, natural disasters and a rising cost of living, working families are struggling to make ends meet. According to a report from the Louisiana Association of United Ways (LAUW), more than half a million Louisiana households cannot afford the basic necessities, despite being employed.

ALICE in the Crosscurrents is the fifth report released by Louisiana United Ways that documents ALICE; or Asset Limited, Income Constrained, Employed. ALICE describes households that earn more than the federal poverty level but less than the cost of living; including people such as cashiers, home health aides and delivery drivers.

People who fall under ALICE cannot afford life’s essentials and are one financial emergency away from poverty.

Since the previous report in 2020, ALICE households have faced COVID-19; six federally declared natural disasters; and increasing costs of a survival budget, which has risen 11% from 2019-2021. As temporary benefits continue to expire, ALICE households face numerous challenges such as deciding whether to spend money on food or healthcare and finding affordable childcare. Elderly workers who were forced to retire earlier than expected are becoming ALICE households, and other ALICE families have had their financial savings for emergencies evaporated.

60% of families in Northeast Louisiana struggle to afford the basics, according to the ALICE report. Of that 60%, only 27% of them are below the federal poverty level.

The ALICE in the Crosscurrents: COVID and Financial Hardship report shows an ALICE household survival budget for a family of four in 2021 being $66,288, which is well above the federal poverty level of $26,500. 75% of Louisiana’s most common jobs earn less than $20/hour, despite an ALICE household needing to earn around $33/hour to keep up with household expenses, even with tax credits.

“For example, a cashier (one of the most common occupations in Louisiana) earned an average hourly wage of $9.83, short of the $13.38 hourly wage needed to meet the ALICE Household Survival Budget for one worker employed full-time, much less for a family with children, which pays an average $1,421 monthly for childcare – more than for rent, food or any other survival expense,” a news release from United Way of NELA says.

United Way of NELA recently launched financial health services in order to help families just like ALICE households.

“Low-to-moderate income individuals and families face multiple economic and societal barriers that prevent them from achieving financial stability and economic independence,” says Kim Lowery, Vice President of Community and Organizational Strategy at United Way of Northeast Louisiana. “Many organizations offer a variety of services designed to help these individuals and families become more financially stable. These services are often delivered by multiple agencies with little coordination amongst each other, making accessibility difficult.”

The new financial health services implement a holistic, integrated approach to improving financial security, making a wide range of services more accessible to community members. These services strive to increase income; decrease debt; increase savings; and gain and sustain assets.

The United Way of NELA lists the following key takeaways from the ALICE report:

• From 2019 through 2021, 22,980 additional households in Louisiana found themselves struggling financially, despite tax credits and other pandemic and Federal Emergency Management benefits. 3
• Between 2019 and 2021, the average annual cost of basic expenses for ALICE families increased by 11% for both single adults and families of four, with childcare, food and housing representing the largest expenses in a typical ALICE family’s survival budget.
• Of the 20 most common jobs in Louisiana in 2021, 75% paid less than $20 per hour, which wasn’t enough for many workers to keep pace with the rising costs of essentials.
• Only 29% of households below the ALICE Threshold had emergency savings equal to three months of expenses, a reduction from the pre-pandemic levels of 37%.
• ALICE is more common in rural Louisiana; Fifty-nine percent of rural Louisiana households and 49 percent of urban households live below the ALICE threshold.

For more information about the United Way of NELA’s work, visit unitedwaynela.org or call 211.

Read the full ALICE report below.

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