Study: More Americans are just 1 financial hardship away from poverty
NEW ORLEANS (WVUE) - A new study shows 40 percent of Americans are one financial hardship away from slipping into poverty. In New Orleans and surrounding parishes, that number is even more staggering.
Sean Perkins said he and his family are hard-working middle class.
"We are working parents and trying to work to save to be that group, working to be above middle class, but its increasingly difficult," Perkins said.
Between living expenses and child care, costs that seem to pile up, he said something always chips away at a decent savings account.
"It would be very difficult if we were to have one major hardship hit us," Perkins said. "It would set us back for quite a long time and probably impact our child's future."
According to numbers from the United Way, they're not alone. More people are struggling to make ends meet, and the United Way classifies those people as living in the ALICE class. ALICE stands for Asset-Limited, Income-Constrained, Employed.
"The ALICE population are our hard-working taxpayers living paycheck to paycheck and unable to save," said Kirby Nagle with the United Way.
In Orleans Parish, 24 percent of people are living below the poverty line. But, when applying the ALICE standard, United Way found some 53 percent struggling households.
"What that number tells is a very different picture than what we traditionally see in job reports, which is what we rely on to give us an indication of what our economy is doing from an economic standpoint," Nagle said.
The United Way of Southeast Louisiana collaborated with more than a dozen other United Way agencies in the country to come up with these numbers. On Thursday they will release the official study analyzing 2016 data. Nagle said the ALICE numbers alone should be seen as a call to action.
"We need people who aren't struggling and aren't living paycheck to paycheck to step up and help their fellow man," Nagle said.
The study is based off what's called the household survival budget, which includes rent or a mortgage, transportation, food and childcare. For a family of four, that's calculated at $51,000 a year. For a single person, it's $18,000 a year.
Nagle said the numbers - which were formally released Thursday - are expected to also integrate the cost of a cell phone and internet.
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