Equity Data Series Examines Regional Income Disparities
RICHMOND, Va. (July 6, 2021) – Nearly 30 percent of Black individuals living in greater Richmond and Petersburg live below 200% of the poverty line, and people without bank accounts may spend $40,000 in fees just to cash paychecks over the course of their lifetime. These are just two of the findings in United Way of Greater Richmond & Petersburg’s latest Equity Data Series installment.
United Way’s Equity Data Series identifies disparities through the lens of the organization’s Steps to Success framework, a set of nine areas that guides the nonprofit’s work in the community. The new report, which focuses on inequities in income, is part of the organization’s commitment to examining inequities across the region and focuses on four categories: unbanked and underbanked; poverty thresholds; home ownership; and asset poverty.
United Way currently funds 15 programs at 14 local nonprofits that are combatting barriers to equitable income. The total 2020-22 investment for income equity is $565,000.
“Poverty continues to be an enormous problem in our region,” said James Taylor, president and CEO of United Way of Greater Richmond & Petersburg. “But we must also understand the widening income disparities and their effect on so many people in our community. It’s clear we have a long way to go, and we’re committed to doing our part to tackle these crucial issues.”
Unbanked and Underbanked
Access to a bank account is important for families and individuals through all stages of life. Without a bank account, people don’t have a safe place to store money, leaving them open to risks of theft or natural disaster. And it can be expensive: People without bank accounts may spend $40,000 cashing paychecks over the course of their working careers. Across the region, there are significant disparities among demographic groups that are unbanked and underbanked.
- Unbanked: Households without a bank account.
- 3% of Latinx households
- 9% of Black households
- 3% of Asian households
- 2% of white households
- Underbanked: Households that have a bank account but have used alternative financial services—such as payday loans—in the past year.
- 1% of Latinx households
- 9% of Black households
- 7% of Asian households
- 4% of white households
United Way is working to counter these access issues through several funding initiatives, including to HumanKind and Thrive Virginia. HumanKind provides fair-interest vehicle loans and financial literacy education. Thrive Virginia offers financial counseling and education programs to help families assess their current financial situation and reach their goals.
The data point to significant disparities among demographic groups experiencing poverty. Black individuals living below 200% of the poverty line make up 29% of the region’s population: They account for nearly half of all individuals experiencing poverty. White individuals make up 62% of the population, but account for only 41% of individuals experiencing poverty. Latinx individuals comprise 6% of the population, but account for 15% of individuals experiencing poverty. Black and white youth, by comparison, account for 30% and 56% of the population, but account for 58% and 29% of the total youth experiencing poverty.
United Way is committed to addressing poverty issues through its Workforce Partnership Team, which bridges the gap between job seekers and employers by removing barriers to employment. United Way also funds LISC Virginia, which helps foster financial stability to low and moderate-income Richmond residents, and ChildSavers, a nonprofit that provides children with trauma-informed mental health services.
Owning a home provides multiple benefits, including financial gains and long-term stability. Over time, owning a home is cheaper than paying rent. In the greater Richmond region, 66% of residents own their homes.
Breakdown of home ownership:
- 49% of Black households
- 50% of multiracial households
- 63% of Asian households
- 74% of white households
United Way is working to address home-ownership inequities through a number of funding initiatives, including to Southside Community Development and Housing Corporation, which help people of color build assets, savings and wealth while working toward home ownership.
A sudden crisis, job loss or unanticipated expense can threaten the financial stability of a household. The asset poverty rate measures the percentage of households without sufficient funds to provide for basic needs and live about the poverty level for three months in the absence of income.
There are disparities across the region among demographic groups experiencing asset poverty. Only 16.4% of white households are asset poor compared to 42.1% of Latinx households, 38.3% of Black households and 15.3% of Asian households.
United Way is combatting asset poverty by funding several local nonprofits, including Hanover Safe Place, which works with victims of domestic violence who are participating in the Rapid Rehousing program and assists survivors to improve their overall financial literacy.
Read more into United Way’s Income Equity Data Series here.