Despite an improving national economy, 51.9 percent of Arkansans are in a persistent state of financial insecurity, according to a report released last week by the Corporation for Enterprise Development (CFED). CFED’s 2014 Assets & Opportunity Scorecard defines these financially insecure residents as “liquid asset poor,” which means they have insufficient savings to subsist at the federal poverty level for three months in the absence of income.
The Scorecard provides rankings for the 50 states and District of Columbia on both the ability of residents to achieve financial security and, for the first time, policies designed to help them get there. Arkansas ranks near the bottom with ranking of 40.
The Scorecard assesses how residents manage across 66 outcome measures in five different issue areas—Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care and Education. Arkansas ranks 40th overall, an improvement over last year’s 46th place rank. The state fared the worst in the issue area of Financial Assets & Income, largely due to our high rates of income poverty (18.2 percent), unbanked (12.3 percent), and underbanked (28.1 percent). Arkansas’s strengths lied in the issue areas of Housing & Homeownership and Health Care because of the state’s affordability of homes and low rates of uninsured children.
On the bright side, Arkansas ranks better than many other states, with an overall policy ranking of 16. The Scorecard also evaluates 67 different policy measures to determine how well states are addressing the challenges facing residents. Overall, Arkansas has enacted 28 of the 67 policies. Arkansas ranked high on policies aimed at decreasing poverty and creating more opportunities for low- and moderate-income families.
“We’ve made some progress toward policies that promote economic opportunity and self-sufficiency, but we have a long way to go,” said Tamika Edwards, Policy Director at Southern Bancorp Community Partners, the lead state organization in Arkansas for CFED’s Assets & Opportunity Network. “If we truly want Arkansans to have the necessary tools to earn economic independence, we must create policies that remove obstacles, provide incentives and otherwise create economic opportunities.”