Nearly half of the households (45%) in our community struggle to afford the basic necessities of housing, child care, food, technology, health care, and transportation.

Terminology: 

ALICE: Asset Limited, Income Constrained, Employed — households that earn above the Federal Poverty Level (FPL) but cannot afford the basic cost of living in their county. Despite struggling to make ends meet, ALICE households often do not qualify for public assistance.

ALICE Household Survival Budget: Reflects the minimum costs of household necessities in Michigan (housing, child care, food, transportation, health care, and technology) plus taxes, adjusted for different counties and household types.

ALICE Threshold of Financial Survival: Derived from the Household Survival Budget, the minimum average income that a household needs to afford basic costs, calculated for all U.S. counties.

Below ALICE Threshold: Includes households in poverty and ALICE households combined.

ALICE Essentials Index: A measure of the average change over time in the costs of essential goods and services. 

County Level Data: 

Household Costs, Public Assistance, And Wages

Financial hardship among Michigan households shifted from 2021 to 2022 based primarily on three factors:

Costs:

From 2021 to 2022, the ALICE Household Survival Budget for a single adult in Michigan increased from $25,932 to $27,372, well above the FPL of $13,590. For a family of four with an infant and a preschooler, the budget (including tax credits) increased from $59,016 to $73,488, well above the FPL of $27,750. Before tax credits, costs for a family of four totaled $78,684 in 2022, up from $72,792 in 2021. (More data on inflation is available in the ALICE Essentials Index June 2024 Update.)

Public assistance:

Pandemic assistance had the most pronounced effects on families with children. The Economic Impact Payments and the expansions of the Child Tax Credit (CTC) and the Child and Dependent Care Tax Credit (CDCTC) helped many ALICE families through 2021. But this assistance was substantially reduced when the 2021 American Rescue Plan expired, stimulus payments ended, and tax credits reverted to 2020 levels. In 2022, a family of four with an infant and a preschooler in Michigan was eligible for approximately $15,000 less in maximum federal tax credits and stimulus payments than in 2021.

Wages:

As pandemic assistance wound down, wages increased for most low-wage jobs. For example, median retail sales wages in Michigan increased from $13.81 per hour in 2021 to $14.38 per hour in 2022.