Life’s ‘real cost’ exceeds income of 31% of Stanislaus families, United Way study shows
Nearly one-third of Stanislaus County households are struggling to cover the cost of living despite almost all having at least one working adult in the home, a study shows.
The study, conducted by United Ways of California, an organization that works to improve the health, education and finances of low-income families in the state, reveals that people are finding it difficult to pay for housing, food, health care, transportation, taxes and child care.
Further, while all families can struggle economically, Black and Latino households — especially those headed by single mothers — face greater barriers to economic security.
Instead of using the federal poverty line (FPL) to measure needs, United Ways of California CEO and President Peter Manzo said the organization developed the real cost measure (RCM), which takes into consideration food but also other essential expenses as mentioned above.
“If you have a single mom with two kids, she should be able to afford a two-bedroom apartment,” he said. “So what we do is we set a universal goal for every household.”
Manzo said the change in measurement was necessary in order to be able to see the real picture, as FPL measurements don’t account for regional variations and are the same for all states despite differences in the cost of living. The study states there’s more or less a 1% margin of error.
The study found that 43,182 households (31%) in Stanislaus County fall below the RCM, with 97% of those families having at least one working adult. Of those 97% of families, 76% have heads of households who are employed full time and work year-round.
Those with children face a greater obstacle to financial security, with 59% of households with children under the age of 6 struggling, according to the study. The median household income in the county for a family of four (considered to be two adults, one infant and one school-age child) is $65,710, less than what’s needed to meet the RCM budget of $70,564 for that family size.
Francine Foley, CEO at United Way of Stanislaus County, said she believes the move by Bay Area families to Modesto is what’s driving up the standard-of-living cost for families in the region.
“How is anybody supposed to do that to be able to survive, when it actually costs $70,000 and you’re making $48 (thousand)?” she said. “It’s nearly impossible.”
In order for a family of four to achieve economic security, the two adults would need to work more than two full-time, minimum-wage jobs.
But single mothers are particularly affected as 75% of them, or 8,693 households, fall below the RCM. On the contrary, 18,070 (29%) married couples and 5,310 informal families (22%) fall below the RCM.
Housing, race and education among barriers
One of the greatest challenges continues to be the high cost of housing, but Manzo believes the development of more affordable housing won’t solve the entire problem. That’s because of all households in Stanislaus, 34% of them spend more than 30% of their income on housing.
Manzo said it can’t be assumed that the creation of affordable housing will solve the fact that people are using a large portion of their paycheck for housing. “As a country, we spend $3 subsidizing homeowners for every $1 we spend on supporting renters. … That seems a little out of balance,” he said, suggesting increasing the subsidized investments towards renters.
Race and legal status are also poverty factors. Of the 43,182 households that fall below the RCM, more than half (24,264) are Latino and 20% (14,239) are white.
Foley said the study highlights the inequities Latinos in the county are facing. “That just shows us the need for us to work with an equity lens to support these people,” she said.
Moreover, the study shows that fewer U.S.-born citizens fall below the RCM than foreign-born naturalized and noncitizens. Only 25,095 (26%) of U.S. citizens were under the RCM, compared to 7,179 (31%) of those naturalized and 10,908 (56%) noncitizens.
But the data revealed that as education went up, the household struggled less. Of the residents with less than a high school education, 9,842 (48%) found themselves living below the RCM.
For those with a high school diploma or equivalent, 14,278 (38%) fell below the RCM, compared to 14,914 (29%) people with some college education.
Although economic inequities remain among the Black and Latino communities, Manzo said he encourages education, particularly so-called dual-generation approaches, as a pathway to minimize the wealth gap. Dual generation would provide parents with affordable or free child care and their children with early education.
At the same time, parents would benefit from dual generation by providing access to higher education opportunities, training and certifications, workforce and community college partnerships, social capital and social services. Manzo hopes local, state and federal governments begin to use the RCM to determine eligibility for assistance as he feels it paints a better picture of what a decent standard of living looks like and how many families actually meet that mark.
“When we say, ‘No one who works full time should live in poverty,’ if we mean that, let’s take some steps to fix it,” he said.
This story was originally published August 25, 2021 at 6:00 AM.
