More than a third of Connecticut households don’t make enough money to cover basic expenses, according to a new report from the United Way of Connecticut.
The United Way’s latest ALICE Report (which stands for Asset-Limed, Income-Constrained, and Employed) showed that, in 2021, 39% of the state’s households were struggling to pay for things like rent, food, and other necessities). This represents a significant increase in the state’s cost of living standard compared to previous years the organization has tracked income data.
According to the report published earlier this week, a single adult had to make an annual salary of $33,000 – or an hourly wage of $16.56 to make ends meet in 2021. A family of four, with an infant and a pre-school-aged child would need at least $106,632 per year, which would require both parents to make at least $26.66/hour.
Connecticut’s minimum wage currently sits at $15/hour and will be increasing to $15.69/hour next year. These rates are on par with minimum wage increases across the country over the last few years but, according to this report, would not be enough to support even a single adult living alone.
According to The United Way, these calculations used conservative numbers and only accounted for necessities of daily life, including housing, food, utilities, transportation, and childcare. They did not account for things like savings, debt payments, or unexpected bills.
According to the report, Black households struggled to make ends meet in 54% of cases, Hispanic households in 57%, and 68% in households with children and a female breadwinner.
It also found significant variation depending on geography. New Haven County has the greatest percentage of households below the ALICE threshold at 41%, followed by both Fairfield and Tolland Counties at 40%. Hartford and Windham Counties sat at 30% below the ALICE threshold in 2021.
While these numbers were based on data from 2021, the United Way report states they believe the threshold has increased in the two years since and is likely to continue increasing into the next few. This is partly due to inflation increases as well as an end to pandemic-era assistance and tax credits for families with children.
“Depending on the federal tax benefits available, the Household Survival Budget, given this inflation for 2023, could be as high as $126,000 for a family of four and $39,000 for a single adult,” says The United Way.
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