To survive in Pennsylvania, a family of four needs to make $59,340 a year — a hard-to-fathom, sticker-shock number that shows how expensive life has become.
That’s the finding of a recently released report by Harrisburg-based United Way of Pennsylvania.
It looks at 2017 statistics about working people who lived above the official poverty line of $24,600 for a family of four, but nonetheless existed in a realm of grinding inequity and privation. In such households — the study estimated 1.2 million of them statewide — financial emergencies like broken-down cars or health traumas can bleed funds, leading to delayed rent or mortgage payments and possible evictions. United Way calls this population ALICE, an acronym for Asset Limited, Income Constrained, Employed.
Data from 2017 was used in “ALICE In Pennsylvania: A Financial Hardship Study” because it was the most current, complete information available.
Penny Smyers of Honey Brook, Chester County, is an ALICE person.
“It just seems the odds are against people,” said Smyers, 45, a home health-care aide with a high school degree. Recently separated, she’s raising a 10-year-old daughter without child support.
“Our parents weren’t working like dogs like we do today to survive. They had more time for their children. I’d love to be able to afford to take my daughter to the Shore for a week. I’m not asking for Paris, for God’s sake.”
According to official government calculations, Smyers, who makes less than $20,000 a year, doesn’t live below the poverty line — $16,910 for a family of two. Still, she said, “I beg to differ,” given how pinched and destitute her life feels.
Researchers who created the study arrived at the income levels by calculating what it cost in 2017 to afford six household necessities: housing, child care, food, transportation, health care, and a smartphone plan.
Of the 5 million households in the state in 2017, 13% lived in poverty, while another 24% were ALICE households. That amounted to nearly 1.9 million households unable to afford basic needs.
In Philadelphia, the study found, of 606,142 households, 55% (more than 330,000) had trouble reaching the household survival income level of $59,340: 27% ALICE, 28% in poverty.
(The official Philadelphia poverty rate in 2017 was 26%, which was a measure of individuals in poverty, not households, as United Way calculated.)
The survival income level is all the more significant in Philadelphia, where the median household income in 2017 was only around $39,000 annually, according to federal figures. In 2017, Philadelphia was recognized as the poorest of the 10 most-populous U.S. cities, a dubious distinction it still holds today.
“This study illustrates an enormous problem,” said sociologist Judith Levine, director of the Public Policy Lab at Temple University. "It looks at a huge group of people who are somewhat invisible to us, since they don’t show up in official poverty statistics.
“Prior to this, there’s been not a lot of effort to measure them.”
The study was conducted by researchers at United Way of Pennsylvania, backed by an advisory committee of experts from Penn State University, the Federal Reserve Bank of Philadelphia, Franklin and Marshall College, Bucknell University, and the University of Pittsburgh, among others.
Calculating the breadth of difficulty throughout the state, researchers found that Philadelphia’s ALICE measure of 55% was the highest; Chester and Allegheny Counties tied for the lowest at 27%.
ALICE households have no typical configuration, the study said. They are young and old, made up of people with varying race backgrounds, and are found in cities, suburbs, and rural areas.
While unemployment figures were lowering in 2017, much of the difficulty people faced in Pennsylvania derived from low-paying jobs.
Nearly 60% of jobs in the state paid less than $20 an hour, with more than half of those paying between $10 and $15 an hour. The study pointed out that a full-time job paying $15 an hour grosses $30,000 a year, roughly half the household survival budget.
While 33% of Pennsylvania jobs paid between $20 and $40 an hour, just 7% of Pennsylvania jobs paid between $40 and $60 an hour.
It has not helped that just 34 percent of the state population in 2017 had only high school diplomas, while another 13 percent had not even gotten that far in school, according to the study.
“For so many people, income just doesn’t match living expenses,” said Ken Ross, founder of the Honey Brook Food Pantry, where Penny Smyers finds herself from time to time. He added that people live in fear of “the unexpected expense that drains what little money is set aside.”
“That’s when all hell breaks loose," Ross said, "and people suddenly are behind on the property tax, and the sheriff’s sale comes a while after that. We hear all the horror stories.”
The study concluded that too many Pennsylvanians are forced to “take risks in order to get by.” That means they forgo health insurance, or car repairs, or even skip meals to save money.
In considering possible solutions, researchers indicated that help from the private sector is key.
That’s the conclusion reached by Bill Golderer, president and CEO of the Greater Philadelphia and Southern New Jersey United Way, a separate organization from United Way of Pennsylvania. Golderer is a Presbyterian minister who founded Broad Street Ministry in Philadelphia, which offers meals, medical service, and other amenities for the homeless in Center City.
“Hank Williams once said, ‘Romance without finance don’t stand a chance,' ” Golderer said. “We need to assemble philanthropic capital to help move Philadelphia out of its dubious distinction of being the poorest of America’s largest cities.”
Golderer said he’s actively working "to create a Marshall Plan” in which the private sector will work with community organizations to help people in need.
“There’s an alchemy of morality, civic pride, and economics that needs to be assembled,” Golderer said.
He said Philadelphia isn’t faring well compared to other large cities that are taking better care of their populations in poverty. He explained: “During the largest economic recovery in U.S. history, among the top 10 cities since 2010, we’re the only city that moved backward in poverty. Every other city saw a 6% increase in income among its bottom 20%.”
Golderer added, “Not only are we the poorest large city, it’s not even close.”
He said he’s in the process of learning what private and philanthropic resources can be combined with public money to move the needle and raise up low-income Philadelphians.
“It’s important to recognize how much people are struggling,” Golderer said. “For so many, it’s not a tornado but a sick aunt who normally provides child care, or a flat tire that puts you over the edge and creates an economic family disaster.”