As the national economy improves, the hope is that a rising tide will lift all boats. But in North Carolina, we are seeing too many of our neighbors sinking lower.
Each year, the Corporation for Enterprise Development releases an Assets & Opportunity Scorecard. It evaluates how citizens are faring across 67 measures in five areas: financial assets and income, businesses and jobs, housing and homeownership, health care, and education.
Despite being heralded as a great place to do business and live, North Carolina received an “F” and ranks 48th nationally in health care, because of the high rates of uninsured households (18 percent) – with the majority being low-income families.
We’re also 44th in the country for the number of low-income residents who don’t have a four-year college degree (61 percent) and 41st for the high-number of low-wage jobs (31 percent of all jobs).
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North Carolina ranks 43rd in the country for its low small-business ownership numbers. These numbers are even worse in communities of color. In North Carolina, if you are white, you are twice as likely to have your own business. That business will be worth 3.5 times more than the average non-white business.
The Scorecard also examines the financial reserves of the average household and finds that many of our residents are living on the edge of serious financial distress.
More than half of our citizens do not have enough of a financial cushion to stay above the poverty line for more than three months if they lost their primary source of income. Again, these numbers are much higher for families of color than white families. Additionally, 33 percent of our residents don’t have savings accounts, with more than 8 percent not having a bank at all. And 64 percent of state residents own their own homes, though, if you are white, you are 1.6 times more likely to do so.
As Donna Gallagher, steering committee member of the N.C. Assets Alliance, says, “When North Carolina families struggle every month to make ends meet, they have little ability to save and build a more financially secure future … our state needs to do more to ensure all residents have the opportunity to move forward and succeed.”
Startlingly, although North Carolina has an overall rank of 41st in the country on various outcome measures of financial security, we rank 14th nationally for related state policies. So, where’s the disconnect?
As Carl Rist, a Durham resident and one of the original authors of the Scorecard, points out, “state policies across the country are not doing enough to address these problems, and the scale of the challenge requires a much more significant and coordinated multisector strategy.”
Often this kind of holistic strategy to improve families’ financial security needs to happen at the local level. Triangle Family Services in Raleigh, for example, offers financial counseling and education on budgeting, managing personal credit, and foreclosure prevention. Last year, more than 2,500 people came to their workshops. In 2014, TFS counselors also assisted 225 families facing homelessness through their Emergency Housing Assistance program.
The Durham Regional Financial Assistance Center has been providing similar comprehensive support to financially stressed households for 25 years, including connections to efforts like the N.C. Foreclosure Prevention Fund. Crisis Assistance Ministry provided financial assistance and counseling to more than 17,000 Charlotte residents last year. It also acts as the local lead for the national Assets and Opportunity Network and has been mobilizing a coordinated approach to tackling persistent poverty – important work in a city that was recently ranked last in Harvard’s Economic Mobility Report.
These efforts will fall short without a similarly strong and committed policy environment. Yet, North Carolina eliminated the state earned-income tax credit – a tax credit for low-income working families that helps them keep more of what they earn and strengthen their longer-term financial security. The credit helped nearly 1 million of our most vulnerable working families across all 100 counties. To eliminate it, especially given the data, seems shortsighted. What’s more, our state’s low rank on health care and our relatively high number of uninsured residents is a direct result of our state’s unwillingness to expand Medicaid with federal support as part of the Affordable Care Act.
North Carolina’s long-term prosperity depends on our ability to create opportunities for all. Numerous social service organizations are doing everything they can to make this happen. In the absence of a supportive policy environment, however, they can only do so much.
Christopher Gergen is CEO of Forward Impact, a fellow in Innovation and Entrepreneurship at Duke University, and author of “Life Entrepreneurs: Ordinary People Creating Extraordinary Lives.” Stephen Martin, a director at the nonprofit Center for Creative Leadership, blogs at www.messyquest.com. They can be reached at firstname.lastname@example.org and followed on Twitter through @cgergen.