(Published July 6, 2023)
The traditional measure of financial need, the Federal Poverty Level (FPL), drastically underestimates the number of households experiencing financial hardship. Across the nation, families are struggling to meet the basic costs of modern society- these are the ALICE families.
Asset-Limited, Income Constrained, Employed- a term coined by United Way to capture those households that make more than the Federal Poverty Level guidelines, therefore no longer qualifying for public assistance, but struggle to afford the basic cost of living in their county. In other words, these are the families with no safety net, who work, but aren’t earning enough income to afford the essentials for their household’s survival.
Beyond food and housing, the household survival budget consists of child care, transportation, health care, and smartphone plans, and includes required taxes. The current Virginia ALICE report reveals how the year following the onset of the COVID-19 pandemic impacted households in the Commonwealth. Yet, the statewide report masks the extent of financial hardship in Southwest Virginia.
In the state of Virginia, in order for a family of four to cover the costs of living in the modern economy, the annual household income needs to be at least $70,788. For a two-parent, two-child household in Southwest Virginia, the annual household survival budget is $56,369. Southwest Virginia’s median household income is $41,540.
Southwest Virginia experiences higher rates of financially constrained households compared to state levels. In 2021, out of the 220,145 households in the region, 51% (compared to 38% statewide) were financially constrained. Specifically, while 19% (compared to 10% statewide) were at or below the poverty threshold, another 32% (compared to 28% statewide) were ALICE families struggling to make ends meet.
Looking at ALICE families by planning district, these rates differ throughout the Southwest region. The New River Valley has the lowest rate with 28% of households classified as ALICE families. Cumberland Plateau has the highest rate at 37%, followed by LENOWISCO (34%) and Mt. Rogers (33%).
Including ALICE households in our understanding of financial hardship in Southwest Virginia has the power to impact half of our region. This data can be used to guide policy, programs, and initiatives to support the families that live and work in Southwest Virginia. Below, you can find your specific locality’s ALICE report.
The Virginia 2023 ALICE report was prepared in partnership with United Ways of Virginia and United for ALICE. To learn more about United for ALICE or to read the full report for Virginia, go to: https://www.unitedforalice.org/county-reports/virginia
