From the 2020 ALICE report: ALICE – a study of families who are Asset-limited, Income-Constrained, and Employed.

Connecticut’s birth rate has been lower than all the New England states and the nation as a whole every year since 2011. This is hurting our state now more than ever, as businesses across Connecticut struggle to fill more than 100,000 job openings.

Taking action to strengthen our state’s ability to attract and keep families – to keep workers — is urgent. And yet, at an average of $16,990 a year, raising a child in Connecticut is more expensive than almost anywhere else in the country.

The United Ways of Connecticut support permanently increasing the state earned income tax credit (EITC) to 41.5% of the federal EITC, and the creating a state child tax credit of up to $600 per child as doable, high-impact steps to help families now living in Connecticut and to draw new ones here – to help our employers and boost our economy, at the same time.

The United Ways of Connecticut have worked for seven years to make available reliable and realistic data on what it costs to live in Connecticut.  This project is called ALICE – a study of families who are Asset-limited, Income-Constrained, and Employed.

Our most recent ALICE report for Connecticut reflects the following: 38% of households – about half a million families in our state – were struggling to make ends meet before the COVID public health emergency.  It takes a household income of more than $90,000 a year for a family of four with one infant and one toddler just to afford their basic needs.

Those numbers are calculated based on the real costs of living in Connecticut before the pandemic. Residents working to get by in 2022 are facing a new set of challenges: interrupted employment, increased physical and mental health needs, unpredictable childcare schedules, and the immediate effect of inflation on everyday necessities like food and now, higher prices for gas.

Connecticut is one of only two states in the country that do not have a tax policy that offsets the costs of raising children, despite the fact that it consistently ranks among the top five most expensive states for child care (the single largest expenses in most family budgets). Our neighbors disproportionately experiencing these untenable situations are 57% of our state’s Black households, 63% of Hispanic households, and 73% of single female headed households with children – all trying to make ends meet in Connecticut at or below this ALICE threshold.

Permanently increasing the EITC and creating a state-level child tax credit will make Connecticut a more family-friendly state, helping to reverse the outward flow of residents. 86% of the taxpayers that leave Connecticut make less than $200,000 a year: this means the state is primarily losing working- and middle-class families that we need most to fill open positions in our small businesses as well as large industries. Now is the time to take practical, proven actions to help our families, boost children, and help the Connecticut economy.

These two steps forward, together, would help to address the core, pressing need of 38% of Connecticut families: inadequate income to afford the basics. Offering these concrete forms of support would help more families choose to stay here – and incentivize others to make Connecticut their home.

And putting money in the wallets of these Connecticut residents will boost the economy. Research by Moody’s shows that for every dollar of EITC a family earns, they return $1.24 to the economy; for every dollar of child tax credit, they return $1.38.  This spending would then provide income for other families in the state, who in turn would increase their own spending creating a virtuous cycle throughout the state’s economy.

It’s time to take these steps to help Connecticut’s struggling families and make a sound investment that will pay dividends for years to come.

Lisa Tepper Bates is president and CEO of the United Way of Connecticut. Maria Harlow is executive director of United Way of Meriden and Wallingford and chair of The United Ways of Connecticut Council of Chief Professional Officers.