Westchester is ending 2016 on a positive economic note, but its strengths conceal another reality: one-third of its households cannot afford the basic necessities.
That’s according to a study of statewide financial hardships by United Way of New York State. The study of financial hardship is titled ALICE, an acronym for Asset Limited Income Constrained Employed.
Researchers combined the federal poverty level – a measurement that is considered outdated and misrepresentative of actual economic conditions – with housing, child care, food, transportation and health care costs. The result is a snapshot of the working poor.
Statewide, Westchester stands out for its robust economy.
The median household income in 2014 was $83,477. That’s 42 percent better than the state and 56 percent better than the national median.
The unemployment rate in November was 4.1 percent, compared with 4.7 percent in New York and 4.4 percent nationally.
And as measured in the United Way study, Westchester households have done better than most places in achieving a survival level.
Overall, 44 percent of the households in New York were either below the official poverty line or struggling to afford the basic necessities. The rate in Westchester was 34 percent. Only Saratoga, Nassau and Putnam counties fared better.
But Westchester’s very economic success makes it harder for a large segment of the population to survive. Living here is expensive.
By breaking down the economic data county-by-county and even city-by-city, the United Way report reveals how wealth and economic hardships are distributed unevenly in New York.
The average single adult in New York, for instance, needs to make $21,540 a year, or a $10.77 hourly wage, to afford the basic necessities. In Westchester, the single adult needs to make $22,680, or $11.34 an hour to get by.
A family of four – two adults, an infant and a preschool child – must make $62,472, or $31.24 an hour, on average, in New York. In Westchester, the family needs at least $77,892, or $38.95 an hour, to make a modest living.
The minimum wage will increase to $10 an hour in Westchester and $9.70 an hour in most of the state at the end of the year.
The biggest challenges in Westchester, compared with statewide averages, are child care, housing and taxes. Families have to budget more than 50 percent higher in those categories. Housing, for example, costs $1,449 a month, or 58 percent more than the $919 a month statewide.
There are also discrepancies within the county. About 55 percent of households in Mount Vernon, 45 percent in Yonkers and 40 percent in New Rochelle are below the livability threshold. The break-even line is 7 percent in Scarsdale, 11 percent in New Castle and 13 percent in Armonk.
Households that are unable to make ends meet are forced to make difficult choices, United Way says. People cut back on health care, child care, healthy food or car insurance, and jeopardize their health, safety and futures. Their communities pay a price in higher taxes, higher insurance premiums and lower productivity.
The challenge, United Way says, is to implement structural economic changes that will enable working households to support themselves. The study is designed as a tool to help policymakers, community leaders and business leaders to understand the financial hardships and create lasting change.