Struggling to Stay Afloat in California
The United Ways of California 2019 study of the financial hardship for working families just been released. Most troubling finding: over 1 in 3 (37%) households in California struggle to meet basic living costs, which is roughly three times as many as federal poverty statistics would indicate.
Using the Real Cost Measure, the researchers determined what it costs to meet a decent standard of living in every county in California, and then analyzed how many families struggle to meet those costs, at the county and neighborhood levels. Unlike the official federal poverty level, the Real Cost Measure factors the actual local costs of housing, food, health care, child care, transportation and other basic needs to estimate the real cost of living in every county in California.
Other key findings of the study reported by President & CEO Pete Manzo include:
- Workers: Of the estimated 3.8 million households in California that fall below the Real Cost Measure, 9 in 10 have at least one working adult
- 6 in 10 Young Children Live in Struggling Households: 60% of households in California with children aged between 0 and 5 fall below the Real Cost Measure
- Housing Burden: Nearly 4 in 10 households in California (38%) pay more than 30% of their income on housing. Households living below the Federal Poverty Level spend up to a staggering 76% of their income on housing.
- Households of all Ethnicities Struggle, but Rate is Higher for Latino and African Americans: Over 1.8 million Latino households are estimated to fall below the Real Cost Measure compared to over 1.2 million white households, 524,000 Asian American households, and 269,000 African-American households
- Single Mothers: Over 7 in 10 households led by single mothers in California (74%) fall below the Real Cost Measure
- As Education Increases, Rate of Struggling Households Falls: Nearly three-fourths of California householders without a high school diploma or equivalent (74%) fall below the Real Cost Measure, compared to those with at least a high school diploma (53%), those with at least some college education (38%), and those with at least a bachelor’s degree (18%)
- Foreign-Born Householders Struggle More: Nearly one-third (30%) of California households led by a person born in the United States earn income below the Real Cost Measure. By contrast, 40% of households led by a person born outside the U.S. are below the Real Cost Measure, and that number rises to 62% when the householder is not a citizen.
The rate of households living with incomes below the Real Cost Measure is increasing, even while the economy is claimed to be growing and official unemployment low. Households living below the Real Cost Measure are overwhelmingly working families. They are doing their part, but as this data makes clear, hard work alone is not enough to get ahead. United Ways is issuing a call to community, business, civic, nonprofit and philanthropic leaders to work towards solutions to help struggling families move up.
Read Pete Manzo’s summary here. The full study results and resources are available at https://www.unitedwaysca.org/realcost, and include data at the county and neighborhood level, with county dashboards, interactive maps, interactive household budgets built in Tableau, downloadable county one-pagers and data set, and more.