The number of Maryland families who couldn’t afford basic needs grew 8% in the first two years of the COVID-19 pandemic, according to a new report.
A new report from the United Ways of Maryland — which help Asset Limited, Income Constrained, Employed (ALICE) families — showed the increase in financially insecure families, but also how pandemic support helped blunt a potentially “deeper financial crisis.”
This was an increase of more than 70,000 Maryland households struggling to afford basic resources by 2021, for a total of 899,798 households, or 38% of all Maryland households, the report said.
Frederick County’s level a drop in ALICE families from 37% in 2018 to 36% in 2021. However, Ken Oldham, United Way of Frederick County’s president and CEO, said in an interview Tuesday that even thought percentage dropped, the number of ALICE households in Frederick County rose by 7,049 as the population grew.
U.S. Census data shows that the county’s population grew 3.2% from 2020 to 2021, then grew 2.4% from 2021 to 2022.
Out of the more than 70,000 new financially insecure households in Maryland, 24,592 were ALICE households, bringing the state total to 654,721. Additionally, 45,731 more of the families were found to be in poverty, increasing the state total to 245,077.
U.S. Census data shows that Maryland’s population dropped about .2% from 2020 to 2022.
The rest of the report that outlines the status of financially insecure families in Frederick County will come out in the fall, Oldham said. Initial findings will be presented and discussed on Thursday at the Delaplaine Arts Center at 5:30 p.m.
The state report also says that while there was an increase in financially insecure households, it could have been more if it weren’t for resources like rising wages and pandemic support that helped ALICE families.
Large government programs like Earned Income Tax Credit — a refundable credit for low- to moderate-income families — and the Child Tax Credit — which helps families with qualifying children get a tax break — helped many ALICE families, Oldham said.
But now, both programs are significantly scaled back, he said, and the effects can be seen on ALICE families.
“We know from our … Volunteer Income Tax Assistance Program that returns for families were substantially smaller, and smaller than expected for the families, and had a significant impact on them,” he said.
According to the report, the basic cost needed to live and work in Maryland for a family of four with an infant and a preschooler was $97,056 in 2021.
With tax credit programs, the budget went down to $81,948. However, ALICE families of four with parents both working full-time jobs fell short of that budget by $19,407, the report said.
According to the report, 55% of the 20 most common jobs in the state — retail salespeople, cashiers, nursing assistants and more — pay less than $20 an hour.
A salary under $20 an hour is not enough for two parents working full time to support a family of four with an infant or preschooler, the report said.
Oldham said the state report is a “cautionary tale.”
Another finding of the report is that there is a racial disparity in financial hardship, in which 49% of Black households and 44% of Hispanic households fall below the ALICE threshold. Among white households, 32% were below that threshold.
The youngest “heads of household” and oldest had the highest rates of financial hardship. Of households headed by older people, 47% could not afford basic needs. The number was higher for households headed by someone under 25, at 73%.
At noon on Wednesday, there will be a webinar to review the National ALICE report, which includes state data. Those who wish to watch may register at tinyurl.com/mu3f7evd.
Rissah Watkins, the Frederick County Health Department’s director of planning, assessment and communication, will be one of the seven panelists speaking at the webinar. Watkins was part of Maryland’s ALICE Research Committee.