New ALICE Report shows pandemic aids temporarily blunted the financial crisis, yet warning signs are on the horizon 

Lansing, Mich., April 26, 2023—The ranks of Michigan households unable to afford the basics grew by more than 62,000 during the first two years of the COVID-19 pandemic, resulting in a total of nearly 1.6 million households, or 39 percent, struggling to afford the basics by 2021, according to a new report from Michigan Association of United Ways (MAUW) and its research partner United For ALICE.

That calculation includes the 525,754 Michigan households in poverty as well as another 1,044,970 families defined as ALICE (Asset Limited, Income Constrained, Employed), earning above the Federal Poverty Level but less than what’s needed to survive in the modern economy. ALICE families have been overlooked and undercounted by traditional poverty measures. ALICE is the nation’s childcare workers, home health aides and cashiers heralded during the pandemic—those working low-wage jobs, with little or no savings and one emergency from poverty. 

ALICE in the Crosscurrents: COVID and Financial Hardship in Michigan shows that the total number of financially insecure households rose by 4 percent between 2019 and 2021—double the 2 percent increase in the state’s overall population. The number of ALICE households increased by 2 percent during this time. Additionally, the report shows that Michigan ranked 22nd in financial hardship among all 50 states, with one of the nation’s higher percentages of households struggling to make ends meet in 2021.  

While job disruptions and inflation delivered significant financial pain, a combination of pandemic supports and rising wages did help to blunt what could have been a deeper financial crisis, the report finds. However, as some benefits are peeled back, and inflation persists, financial strain may continue to plague Michiganders below the ALICE threshold. 

“These hardships, including access food, healthcare, and education for ALICE families was often hidden in plain sight until the pandemic,” said MAUW CEO Hassan Hammoud. “Equipped with the ALICE name and data, we can do even better to develop effective policies and track our progress toward reducing financial hardship in Michigan. We have an opportunity to build on what was learned during the pandemic as ALICE continues to face economic uncertainty.” 

According to the report, for a family of four with an infant and a preschooler, the annual ALICE Household Survival Budget, which is the basic cost needed to live and work in Michigan, was $72,792 in 2021. The Child Tax Credit and Child Dependent Care Tax Credit helped to soften the blow, bringing the family Survival Budget down to $59,016. 

“To ensure every Michigander has access to economic opportunity and prosperity, we are using the latest data from the ALICE report and working with partners across the state to deliver real solutions that make sure people in our state aren’t struggling to put food on the table or make ends meet for their family,” said Kim Trent, Deputy Director of Prosperity at the Michigan Department of Labor and Economic Opportunity (LEO). “LEO and the Michigan Poverty Task Force will continue to focus on efforts that lift Michiganders out of poverty and above the ALICE threshold.”

Even with the variety of temporary pandemic supports available, in 2021, a family of four with two-full time workers earning salaries as a retail salesperson and a cashier—two of the most common occupations in Michigan—was just able to meet their basic expenses with the help of these supports. 

“A positive change during the pandemic was that tax credits, stimulus payments and rental assistance were available for ALICE households and provided strong relief,” said Stephanie Hoopes, Ph.D., United For ALICE National Director. “However, as some of these supports come to an end, growing food insufficiency and other indicators reveal continued stress. Ignoring these warning signs places ALICE, our economy and the well-being of our communities at great risk.” 

Additional report insights include: 

• Racial disparities persist in the rates of financial hardship with 59% of Black and 44% of Hispanic households falling below the ALICE Threshold in 2021, compared to 36% of white households.

• Single-female-headed households had among the highest rates of hardship. Well over half, or 71%,of Michigan’s single-female-headed households could not afford basics in 2021.

• In 2021, 70% of the 20 most common jobs in Michigan paid less than $20 per hour. As a result, many of these top jobs still had a substantial percentage of workers who were either ALICE or in poverty in 2021.

• In Federal Reserve surveys, the percentage of respondents who were either ALICE or in poverty reported seeing emergency savings rise from 35% in October 2019 to 41% in November 2021. Meanwhile, those survey respondents who were financially stable saw emergency savings rise from 65% to 74%.  

MAUW held a press conference on Wednesday, April 26 at the Michigan Credit Union League & Affiliates in downtown Lansing to announce the report publicly. Speakers included MAUW CEO Hassan Hammoud, Deputy Director for Prosperity for the Michigan Department of Labor and Opportunity Kim Trent, Consumers Energy Executive Director of Corporate Giving Carolyn Bloodworth, and current and former members of Michigan’s ALICE community. Immediately following the press conference, United Ways advocates from across the state headed to the Capital building to meet with legislators about the report’s findings. To view a recording of the press conference, please click here. 

“We want to ensure all Michigan residents are equipped with the resources they need to succeed, but in order to do that we first have to understand what they’re already working with, and what they’re lacking,” said Carolyn Bloodworth, secretary/treasurer of the Consumers Energy Foundation. “We are proud to continue to support the development of the ALICE Report – a critical tool for providing the data and information needed for policymakers and organizations in Michigan to make informed decisions impacting our most vulnerable populations. Together, we can create sustainable communities that are able to thrive well into the future.” 

To read the report and access online, interactive dashboards that provide data on financial hardship at the state, county, and local level, visit United4ALICE.org/ALICECrosscurrents.

About United For ALICE  

United For ALICE is a driver of innovation, research and action to improve life across the country for ALICE (Asset Limited, Income Constrained, Employed) and for all. Through the development of the ALICE measurements, a comprehensive, unbiased picture of financial hardship has emerged. Harnessing this data and research on the mismatch between low-paying jobs and the cost of survival, ALICE partners convene, advocate and collaborate on solutions that promote financial stability at local, state and national levels. This grassroots ALICE movement, led by United Way of Northern New Jersey, has spread to 27 states and includes United Ways, corporations, nonprofits and foundations in Arkansas, Connecticut, Delaware, Florida, Georgia, Hawai‘i, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Mississippi, New Jersey, New York, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Virginia, Washington, Washington, D.C., West Virginia and Wisconsin; we are United For ALICE. For more information, visit: UnitedForALICE.org. 

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About the Michigan Association of United Ways
Michigan Association of United Ways (MAUW) is a partner in developing powerful responses to current and emerging issues in local communities. The State Association provides leadership in policy influence and capacity building to affect positive change. MAUW serves approximately 35 local United Ways that represent the largest network of non-governmental service providers and service funders in Michigan, collectively raising and distributing significant resources to support local health and human service organizations.

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