Struggling to Get By: The Real Cost Measure in California 2015

Almost 1 in 3 California households struggle each month to meet their basic needs, according to a report released today by United Ways of California.

The report, Struggling to Get By: The Real Cost Measure in California 2015, finds that 3.2 million California households do not earn enough income to account for the types of expenses—food, rent, health care—that are essential to maintain even an adequate level of economic security. Not only do these households not have enough money to save for the future or afford “luxuries” like eating out, but they are forced to confront tradeoffs each month about whether to forgo necessities like child care or doctor’s appointments in order to make ends meet.

Struggling to Get By introduces the Real Cost Measure, a new tool that provides a more realistic picture of poverty than the Federal Poverty Line. The Real Cost Measure creates “basic needs” budgets for households, using actual costs for food, housing, transportation, health care, childcare, and taxes throughout California.

Among the questions Struggling to Get By seeks to answer are: What is the true rate of financially challenged households? How many are led by working adults? What do we know about these households? What do their family configurations look like? What regions and communities struggle more than others? What do income challenges look like across race, ethnicity and gender boundaries and more.

Some of the key findings from Struggling to Get By: The Real Cost Measure in California 2015 include:

  • One in three California households (31%) do not have sufficient income to meet their basic costs of living. This is three times the proportion officially considered poor in California, according to the Federal Poverty Level.
  • Households led by people of color disproportionately are likely to have inadequate incomes. 51% of Latino households and 40% of African American households have incomes below the Real Cost Measure. This is followed by Asian American households (28%) and white households (20%).
  • 60 percent of households led by a noncitizen struggle to make ends meet. By contrast, 1 in 4 native-born Americans and 36% of naturalized American citizens are below the Real Cost Measure.
  • Just over one-half of households with children under six years of age (51%) fall below the Real Cost Measure.
  • Nearly 2 in 3 (64%) households maintained by single mothers have incomes below the Real Cost Measure. In contrast, just one-fourth of married couples with children (25%) are below the Real Cost Measure.
  • Two-thirds (68%) of householders with less than a high school education have incomes below the Real Cost Measure. That number falls to 13% for those with at least a Bachelor’s degree.
  • Struggling households spend over 50% of their income on housing, and families living below the Federal Poverty Level can spend as much as 80% of their income on housing.
  • Two full-time, minimum wage jobs are not enough to sustain a family of four. Yet, two-person, two-child households with two full-time, minimum wage earners earn $33,280 in gross income still fall below the Real Cost Measure by $10,000 to $30,000, depending on where they live.

Struggling to Get By also uses the Elder Index refined by researchers at the UCLA Center for Health Policy Research and the Insight Center for Community Economic Development to take an in-depth look at senior-led households. Despite seniors’ different needs and work-force participation than younger adults, Struggling to Get By finds that a similar share—almost 1 in 3 (31%) are struggling.

The full Struggling to Get By report can be found at http://www.unitedwaysca.org/realcost. Here, users will be able to find interactive county and neighborhood maps, an interactive dashboard on Real Cost Budgets and a public data set where advocates, policymakers and the general public will be able to determine the basic costs of living for any family as well as how many people are not able to meet that standard.