More than 1/4 of state’s households struggled financially even before pandemic
Over 1.3 million Pennsylvania households, or 27 percent, were already struggling financially when COVID-19 hit last year, according to Kristen Rotz, president of the United Way of Pennsylvania.
“That’s 27 percent of our households who are in this working family category, where they earn more than the federal poverty level wages, but not enough to afford all of their household essentials,” Rotz said.
That category is referred to as Asset Limited, Income Constrained, Employed. Rotz made her remarks at a ZOOM media event Tuesday.
Many in these households have been employed throughout the pandemic, Rotz said. They have been in the high demand occupations, such as in grocery stores and child care centers or working as home health aides.
“They’ve been hailed as the heroes of our pandemic,” she noted.
“We’re really pleased that for the first time, kind of broadly, our communities are recognizing the importance (these people) plays every day to make sure that our communities are what they are and that we can all live the quality of life that we currently enjoy,” Rotz said.
People in this category have also worked in the hospitality or retail industry, two areas which have seen a slowdown in business, if not a permanent shutdown, because of the pandemic.
In addition to the 27 percent in that category, another 12 percent of state households consist of people living below the federal poverty level.
The United Way has compiled a survival budget that covers the absolute essentials for a household as a tool to identify those in these categories.
“It truly only covers the absolute essentials for the household. There are no extras, there’s no going out to eat. It really focuses on a roof over your head, food on your table, some form of health care for your family and child care,” she explained.
Because of the economic changes brought about by the pandemic, the United Way decided to conduct interviews across the state to determine the effects of the health crisis.
What they found was that those in the Asset Limited, Income Constrained, Employed category were more likely to worry about being able to afford housing and the costs associated with that. Those not in that category expressed that they were more concerned with contracting COVID-19.
The study also discovered that because those in income-constrained households were already struggling to get by pre-pandemic, they had far less savings at their disposal to meet emergency needs.
“We found that these households had one month or less of savings to be able to cover all of their basic household bills,” Rotz said.
The remaining households in the state had two months of savings or more, the study revealed.
Phil Falvo, public policy director with the United Way, who was at the event with Rotz, cited two public policy priorities that the United Way would like to see implemented in order for families in this income category to make ends meet — a state earned income tax credit and continued support for the PA 211 hotline in order to connect individuals in need of support and services.