The Michigan Association of United Ways Finds Low Wages, Reduced Work Hours and Depleted Savings among Challenges for Michigan’s Working Families
Fenwick, Mich. – United Way Montcalm – Ionia Counties joined the Michigan Association of United Ways (MAUW) in releasing a study on the condition of Michigan’s working families, which it has dubbed ALICE households—those that are Asset Limited, Income Constrained, Employed. The report found that ALICE households now make up 49 percent of Montcalm County and 43 percent of Ionia, and 43 percent of all Michigan households. Despite overall improvement in employment and gains in median income, 23,556 Montcalm households and 22,625 Ionia households could not afford basic needs such as housing, child care, food, transportation, health care and technology. The cost of the average Michigan family budget also increased by 27 percent from 2010 to 2017, despite a low rate of inflation nationwide—12 percent during the same timeframe.
“Here in Montcalm and Ionia counties we know all too well the challenges ALICE families face,” said Terri Legg, executive director of United Way Montcalm – Ionia Counties “It’s critical that community organizations, business leaders and policymakers work in tandem to help Michigan’s hardworking families overcome the obstacles to make ends meet. The ALICE Report is an important step toward paving a path forward for our state.”
Although unemployment rates are falling, the report found that low-wage jobs dominate the employment landscape, with 61 percent of all jobs in Michigan paying less than $20 per hour. At the same time, an increase in contract jobs and on-demand jobs is leading to less financial stability. For the many households that earned slightly above the ALICE threshold in the past, increases in the cost of living and flat wages have pushed them below the threshold and into financial hardship.
“Nobody working more than 40 hours a week should be struggling to take care of themselves and their families,” said Michigan Governor Gretchen Whitmer. “We need to come together and invest in real solutions that will help Michiganders get ahead. The budget I proposed this month will do just that, by doubling the Earned Income Tax Credit and repealing the Retirement Tax, which will save families hundreds of dollars per year, and making the biggest investment in K-12 education in a generation of kids. I’m eager to work with my partners in the legislature to pass a budget that will help lift Michigan families out of poverty and ensure everyone has a path to a good-paying job.”
The Michigan Association of United Ways joins with roughly 450 United Ways from 15 states across the country to better understand the struggles of ALICE. Various organizations across the country are also using this data to better understand the needs of their employees, customers and communities. In Michigan, the Consumers Energy Foundation granted $25,000 to fund the study.
“At Consumers Energy, we are committed to helping Michigan succeed. The ALICE Report is important because it provides policymakers, community leaders and businesses with detailed data to shape good decisions that serve the people of our state,” said Brandon Hofmeister, president of the Consumers Energy Foundation.
To produce the United Way ALICE Report for Michigan, a national team of researchers collaborated with the Michigan Research Advisory Committee, composed of representatives from across the state, who advised and contributed to the report. The report focuses on providing objective, comprehensive county-by-county data that identifies the size of the ALICE population in Michigan and works to identify the obstacles that keep these residents from achieving financial independence. The current report builds on data found in the 2017 ALICE study, showing not only continuity but also highlighting United Way’s commitment to this data.
United Ways currently work to provide some short- and medium-term solutions for ALICE households, such as offering scholarships to access quality child care, free tax preparation and financial and career mentoring. In shedding light on the underlying causes keeping ALICE households from getting ahead, MAUW provides information that will inform discussions with businesses, government agencies, other nonprofits, the faith-based community and residents to create solutions for a stronger Michigan.