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Report: Pandemic worsens financial instability for many

Tim Croft

A new report spotlights that the novel coronavirus pandemic struck at a time when many Northwest Florida households were already economically teetering.

According to the report, issued by United Way of Florida in partnership with United for ALICE (Asset Limited, Income Constrained, Employed), nearly 2.6 million Floridians, a 10-year high, was just one financial emergency away from financial ruin.

Someone(s) was employed, but the household existed literally paycheck-to-paycheck and not catching up.

And that was before the pandemic arrived earlier this year and businesses and schools closed.

“We’ve known that our economy was increasingly reliant on these families we call ALICE, who are financially vulnerable to one emergency,” said Bryan Taylor, CEO of the United Way of Northwest Florida.

“COVID-19 became that one universal emergency. ALICE families are facing the greatest health and financial risks today, as they are the workers who don’t have health insurance, have no paid sick days, and whose children receive daily meals at school.”

In the six-county region served by the United Way of Northwest Florida, 55 percent of the population are in ALICE households or live below the poverty line.

Jackson County tops the list at 58 percent, but Gulf, Washington and Holmes counties are right behind at 57 percent of the population living economically vulnerable.

In a breakdown of Gulf County the report noted the low unemployment (at the time) and high number of workers employed but offered a critical caveat.

“A significant portion of full- and part-time workers are paid by the hour; these workers are more likely to have fluctuations in income and less likely to receive benefits,” according to the report.

Additionally, wages in the county are held down by the significant, 35 percent, number of people of working age who are out of the workforce and not seeking work, according to the press release.

Fewer workers mean fewer incentives for employers to raise wages, paraphrasing the report.

Further, at both ends of the county ALICE and poverty levels are above the region average; in Port St. Joe 61 percent of households were considered either ALICE or living below the poverty line.

And, once again, to emphasize, this was before COVID-19.

In a measurement called Household Survival Budget, the report found that average household costs in Gulf County were already above poverty levels in 2018; meaning those living below poverty started each month behind.

The gap between ALICE and non-ALICE families has been steadily growing in Florida the past decade, according to the United Way press release.

Between 2007 and 2018, the number of ALICE households in Florida jumped from 22 percent to 35 percent while poverty levels remained relatively steady at 13 percent.

“No matter how hard ALICE families worked, the gap between their wages and the cost of basics just kept widening,” Taylor said. “These already fragile ALICE households are now facing an even deeper financial hole due to the state of emergency created by COVID-19.”

ALICE in Florida: A Financial Hardship Study showed the cost of survival in Florida ranges annually from $24,600 for a single adult to $69,516 for a family of four with an infant and a preschooler.

Compare, then, that the average hourly wage in Florida is $22,040 per year.

Taylor said the report’s findings should be part of the current discussion to identify state and local supports to address the unique financial impact of the pandemic on vulnerable households as businesses and schools remain closed indefinitely.

The report called for “stakeholders across all sectors to use the report’s findings to remove obstacles to financial stability, identify gaps in community resources and build data-driven solutions to help ALICE families achieve economic stability, bolstering the state’s economy overall.”