Economic Mobility Starts with Economic Stability: A Philadelphia Story
With the inaugural Understanding Economic Stability and Economic Mobility in Philadelphia Report, the Federal Reserve Bank of Philadelphia and United For ALICE® provide pioneering insights into economic volatility and life satisfaction. The two-part, mixed-methods study reveals the complexities of economic life in the City of Brotherly Love, especially for households below the ALICE Threshold.
First, the organizations administered a text-based survey, which followed Philadelphia residents during a six-month period (December 2023 – August 2024; 592 individuals completed the first month of the survey and 363 completed all six months.). Then, they conducted a series of in-depth focus groups to dive into participants’ experiences with work, income, and life satisfaction. The Report reveals a clear picture: to make the move up the economic ladder, people first need stable financial footing, which doesn’t come easily.
“…There are barriers to moving upwards. And those barriers are very real, and, in my view, very severe,” one participant shared.
A key research question was whether there were differences in experience by households’ ability to afford basic expenses. This is especially important in Philadelphia where nearly half of households fall below the ALICE Threshold. This accounts for all households with income less than the cost of living in Philadelphia – including only basic expenses related to housing, food, child care, transportation, health care, technology, and taxes.
The study, which was shared at the Federal Reserve Bank of Philadelphia’s Economic Mobility Summit* in April 2025, found that respondents below the ALICE Threshold often experienced dramatic swings in income. For many, these fluctuations had become a regular — and frustrating — part of their work life. Among survey respondents below the Threshold:
• 87% experienced wage swings of at least 10% during the six-month period, while 74% of respondents above the Threshold reported the same fluctuations.
• 59% couldn’t pay all their bills each month, compared with 23% above the Threshold.
• 13% did not have access to stable housing, compared with 5% for those above the Threshold during the same six-month period.
For many, instability doesn’t only impact their wallets, it also affects their health and well-being. Some respondents referenced “the grind,” the daily fatigue of working hard without getting ahead, especially when financial instability continued for long periods of time. Respondents below the ALICE Threshold were more likely to report dissatisfaction with life (22%) compared to respondents above the Threshold (6%).
One respondent talked about living paycheck-to-paycheck as “frustrating and taking a toll on me mentally because I’m working so hard and … I feel like I don’t see the fruits of my labor.” Yet, the ability to pay bills, even if temporarily, improved participants’ outlook on life significantly. According to one participant, “If [the bills are] paid, then your mental [health] is fine and you’re able to enjoy and look at things differently.”
ALICE families experience substantial barriers to work, including challenges with finding jobs with adequate pay, difficulty with online applications, and the need for flexible schedules. In addition, compared to families above the Threshold, families below the ALICE Threshold were:
• 5x more likely to say caregiving limited their ability to work.
• 3x more likely to face health-related work limitations.
• Nearly 3x more likely to struggle with transportation access.
Like many households throughout the country, Philadelphians experiencing financial hardship have become adept at finding ways to pay their bills. Minimizing transportation costs, charging family members rent or taking on a roommate, moving to less expensive housing and careful budgeting all help. Gig work, or “side hustles,” puts additional money in their pockets to cover basics and occasional “extras,” like an unexpected bill or a child’s birthday present. For some, enrolling in public benefit programs also provides a lift, although others find the system meant to give a needed boost often difficult to navigate, sometimes even counter intuitive. One woman shared how a small raise at work led to losing health insurance for her child, saying, she “had to quit her job … because she couldn’t afford the increase.”
Many ALICE households remain hopeful that they can move from stable footing to economic mobility. The key: Finding a better job! Others pointed to the need for housing assistance or benefits support.
The findings clearly identify that economic mobility starts with economic stability. Stability means the ability to meet immediate needs so that you can think about the future. According to one participant, “mobility means the ability to go places … unless you have your basic needs taken care of, you’re not going anywhere.”
The report’s co-authors include Ashley Anglin, Ph.D., Director of Research & Strategic Analysis and Stephanie Hoopes, Ph.D., National Director, United For ALICE.
Visit our United For ALICE website to learn more about ALICE research.
*Thumbnail and hero images were both captured at the Summit
