Walworth County’s Working Poor

In Whitewater and throughout Walworth County, huge numbers of residents are “asset limited, income constrained [yet] employed” (ALICE®). A report from the United Way of Wisconsin, entitled ALICE® ASSET LIMITED, INCOME CONSTRAINED, EMPLOYED WISCONSIN, reveals the truth about many in our community.

Walworth County measures slightly worse than the already-disappointing state average.

The talk of supposed development gurus, many of them earning public salaries while feebly chattering about all the tools they have, meets its refutation in the actual measurement of residents’ economic lives.

Decades of taxpayers’ wages used for corporate welfare, smarmy officials’ attention to their business buddies, and a rejection of truly free and productive markets, have not uplifted individuals’ and households’ economic well being.

These alphabet agencies – WEDC, Whitewater CDA, Walworth County EDA, and dozens more – still leave us here: large press releases extolling empty claims but for it all still larger numbers of working poor.

A portion of the executive summary, and the full report, are embedded below —

Across Wisconsin, 42 percent of households struggled to afford basic household necessities in 2014.

Like the nation as a whole, Wisconsin faced difficult economic times during the Great Recession. Yet the Wisconsin poverty rate of 13 percent obscures the true magnitude of financial instability in the state. The official U.S. Federal Poverty Level (FPL), which was developed in 1965, has not been updated since 1974, and is not adjusted to reflect cost of living differences across the U.S. A lack of accurate measurements and even updated language to frame a discussion has made it difficult for states – including Wisconsin – to identify the full extent of the economic challenges that so many of their residents face.

This Report presents four new instruments that measure the number and conditions of households struggling financially, and it introduces the term ALICE – Asset Limited, Income Constrained, Employed. With the cost of living higher than what most wages pay, ALICE families work hard and earn above the Federal Poverty Level (FPL), but not enough to afford a basic household budget of housing, child care, food, transportation, and health care. ALICE households live in every county in Wisconsin – urban, suburban, and rural – and they include women and men, young and old, of all races and ethnicities. The Report includes findings on households that earn below the ALICE Threshold, a level based on the actual cost of basic household necessities in each county in Wisconsin. It outlines the role of ALICE households in the state economy, the public resources spent on households in crisis, and the implications of struggling households for the wider community.

Using the realistic measures of the financial survival threshold for each county in Wisconsin, the Report reveals a far larger problem than previously identified. Wisconsin has 289,209 households with income below the FPL but also has 670,922 ALICE households, which have income above the FPL but below the ALICE Threshold. These numbers are staggering: In total, 960,131 households in Wisconsin – fully 42 percent, and triple the number previously thought – are struggling to support themselves.

ALICE households hold jobs and provide services that are vital to the Wisconsin economy, in positions such as retail salespeople, office clerks, cashiers, and food preparers. The issue is that these jobs do not pay enough to afford the basics of housing, child care, food, health care, and transportation. Moreover, the growth of low-skilled jobs is projected to outpace that of medium- and high-skilled jobs into the next decade. At the same time, the cost of basic household necessities continues to rise.

There are serious consequences for both ALICE households and their communities when these households cannot afford the basic necessities. ALICE households are forced to make difficult choices such as skipping preventative health care, healthy food, or car insurance. These “savings” threaten their health, safety, and future – and they reduce Wisconsin’s economic productivity and raise insurance premiums and taxes for everyone. The costs are high for both ALICE families and the wider community

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