It has been two years since United Way of Northeastern Minnesota (UWNEMN) united with United Way organizations across the state to bring the United for ALICE dataset, which highlights the growing financial strains on the demographic known as ALICE® (Asset Limited, Income Constrained, Employed), to Minnesota.
The report has now been updated to reflect 2024 numbers and shows that the cost of household necessities in Minnesota has risen faster than inflation for more than 15 years, leaving many households vulnerable to the growing affordability crisis.
Earning wages above the Federal Poverty Level but still unable to afford basic expenses, 579,571 Minnesota households were ALICE in 2024. When combined with households in poverty, 35% of all households in Minnesota fell below the ALICE Threshold of Financial Survival.
“Behind these numbers are families making impossible choices every day between groceries and utilities, childcare and rent,” said United Ways of Minnesota Executive Director Beni Westgor. “The ALICE data helps guide our work with partners across Minnesota, so we can respond to immediate needs and help build stronger paths to stability.”
The report includes data from the ALICE Essentials Index, which tracks the rising costs of only six basics families need to live and work: housing, childcare, food, transportation, health care and technology. Between 2007 and 2024, the ALICE Essentials Index for Minnesota increased 64%, compared with 52% for the broader Consumer Price Index (CPI), which reports inflation across more than 200 categories of goods and services.
The crux of the struggle for ALICE families is the gap between wages and expenses. In 2024, the average cost for a family of four in UWNEMN’s service area (Iron Range, Koochiching County, and Lake of the Woods County) needed $62,136 just to cover the essentials - nearly double the Federal Poverty Level of $31,200.
“After years of relying on the Federal Poverty Level to define need in our communities, we are so grateful to now have access to the ALICE data,” said UWNEMN Executive Director Erin Shay, noting the organization has adjusted its current program guidelines to include ALICE households. “We now have a better understanding of the true need and can work to make change for all the hardworking people in our communities who have been falling through the cracks and struggling in secret.”
The State of ALICE in Minnesota also reveals that in 2024:
- 10% of Minnesota households in Minnesota were in poverty; another 25% were in poverty. Comparatively:
- 12% of households in Itasca County were in poverty in 2024; another 25% were ALICE.
- 11% of households in Koochiching County were in poverty in 2024; another 22% were ALICE.
- 7% of households in Lake of the Woods County were in poverty in 2024; another 25% were ALICE.
- 13% of households in Itasca County were in poverty in 2024; another 23% were ALICE.
- ALICE households were found in every major industry statewide, with the highest levels of hardship in food service and accommodation, 39%, retail trade 26%, and health care 22%.
- Poverty rates in Minnesota have remained relatively flat since 2010, while the number of ALICE households has been increasing. The latest report indicates the ALICE rate is beginning to level.
- Minimum-wage workers in Minnesota saw hourly pay rise to $10.85, up from $10.59 in 2023. Yet for one full-time adult worker with one school-age child, that wage still was not enough to support the ALICE Household Survival Budget, the minimum cost of basics, in nearly half of all counties across Minnesota.
- No household makeup in any of the communities served by UWNEMN could afford a survival budget if earning minimum wage.