More and more Americans are becoming ‘ALICEs.’ They can’t afford rent and groceries but are falling through the cracks in the country’s

Imagine making just enough money at your job that you don’t qualify for food stamps or disability payments, but not enough to afford rent and healthcare. That would make you an ALICE.

ALICEs — or Asset Limited, Income Constrained, Employed — is a term coined by United Way’s United for ALICE program to describe Americans who work and make more than the Federal Poverty Level for a family of four of $31,200, or $15,060 for an individual, but who struggle to pay for basic needs.

Many ALICEs are workers whose wages typically aren’t enough to cover their bills, meaning they live paycheck to paycheck. Some are forced to sacrifice rent payments for food or childcare for medical appointments.

About 29% of the US population are ALICEs, while 13% are below the Federal Poverty Level, according to United for ALICE’s calculations using data from the Census Bureau’s American Community Survey and United Way’s estimates for how much a family needs to get by.

Many government initiatives have tried to help people rise out of poverty. Still, as Stephanie Hoopes, national director at United For ALICE, told BI, the Federal Poverty Level is outdated in many ways, as it doesn’t account for regional differences and the growing proportion of people’s budgets that go to food. Hoopes also said that less attention is paid to assisting those who are better off financially but still can’t invest in their futures.

For the most part, poverty shares across the US have been falling — something that, on its face, seems like good news for American workers. And while those measures might reach the most financially distressed Americans, the benefit cut-offs leave behind the still-precarious group of ALICEs.

But the share of ALICEs has been rising across the country over the last decade or so, with pandemic boom states like Montana and Idaho seeing big jumps. That comes as many Americans’ earnings increased but may not have kept pace with skyrocketing inflation and housing prices.

The prevalence of ALICEs might point to an economic issue undergirding what looks like a robust labor market: Americans are increasingly falling between the cracks of affluence and assistance, and policy isn’t rising to meet them. It’s a marked contrast to the pandemic-era stimulus that eradicated qualifications for different types of aid and provided direct stimulus.

“It’s hard to get in data the frustration, the stress, the ongoing day in day out, having to make some really bad choices,” Hoopes said. “Are you going to get the medicine for your kid, or are you going to have dinner tonight? Are you going to keep the electricity on? Are you going to go to childcare?”

Fewer Americans are in poverty, but more are ALICEs

To qualify for SNAP, for instance, families must have an income below about 138% of the Federal Poverty Level, meaning a family of four must have a gross income below $39,000.

For Supplemental Security Income, which provides benefits for Americans with disabilities, the cutoff for individuals is usually $23,652 from yearly wages. Some state-to-state benefits are often available to individuals and families earning 200% to 250% of the Federal Poverty Level.

United For ALICE found that inflation has hit those households even harder than the typical American. The Consumer Price Index, one of the main measures of inflation in the US, includes many goods and services that ALICEs aren’t buying frequently, such as dinners out, sports gear, or concert tickets.

United For ALICE developed the ALICE Essentials Index that more closely tracks the survival budget for lower-income households. When measuring inflation for just basic expenditures, the ALICE Essentials Index has increased faster than CPI. Simultaneously, over the last 12 years, ALICEs have been falling behind on wage increases.

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