Report: Almost 40 percent of Iowa households struggled to meet basic needs in 2016

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Illustration by Jordan Sellergren

A new report from a United Way research project found that 457,223 households in Iowa were “struggling to afford basic necessities” in 2016, the most recent year for which researchers have data. According to the report, that represents a 27 percent increase in the number of struggling households since 2010.

The United Way project is known by the acronym ALICE, which stands for “Asset Limited, Income Constrained, Employed.” Researchers determine the amount of money both a single adult and a family of four in a state need to afford the most basic level of housing, child care, food, transportation, health care and a bare-minimum cellphone plan.

Researchers estimate a single adult needed $19,560 in annual income to meet basic needs in 2016, and a family of four (two adults, one infant and one preschooler) needed $56,772. Thirty-seven percent of Iowa’s 1,250,638 households fell below those levels.

“Many of these households belonged to working families,” Deann Cook, executive director of United Ways of Iowa, wrote in a letter accompanying the release of the ALICE report. “These workers are doing the jobs we rely on to make our communities run smoothly — they are cashiers, health care workers, child care providers, custodial staff, and customer service employees, and hold countless other vital jobs that make our days easier.”

To afford the necessities cited by United Way researchers, a single adult in Iowa would need a full-time job making $9.78 an hour, and a family of four would need to make $28.39 an hour. But as the report explains:

Low-wage jobs continued to dominate the employment landscape in Iowa, with 66 percent of all jobs paying less than $20 per hour. Although unemployment rates fell, wages remained low for many occupations. With more contract work and on-demand jobs, job instability also increased, making it difficult for ALICE workers to meet regular monthly expenses or to save.

Iowa’s minimum wage is $7.25 an hour, the lowest minimum wage legally possible since it is also the federal minimum wage. That federal minimum wage has remained unchanged since 2009. In 2017, the Iowa legislature passed a bill freezing the state’s minimum wage at $7.25 an hour, and invalidating any city or county regulations — including one in Johnson County — that mandated a higher hourly wage.

The report includes the percentage of ALICE household by county. In Linn County, 30 percent of households fell below the ALICE threshold, as did 38 percent of Johnson County households. Decatur County in southern Iowa had the highest percentage of ALICE households, 52 percent, and Iowa County had the lowest with 29 percent.

Researchers used data from the several federal agencies — the Census Bureau, the Department of Labor, the Internal Revenue Service, the Department of Agriculture and the Department of Housing and Urban Development — as well as the Iowa Child Care Resource & Referral and the nonpartisan Tax Foundation.

In her letter, Cook said United Way hoped the report would raise awareness about “this population that tends to be hidden in plain sight. ALICE does live in Iowa. Despite our reputation for feeding the world, we have Iowans who struggle to feed their families.”

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