New research finds Native households are more financially stressed

We got a window into Americans’ financial security on Tuesday from the Federal Reserve’s annual Survey of Household Economics and Decisionmaking — better known as the SHED. Seventy-two percent of respondents reported doing at least “okay” financially in 2023, and 63% said they could cover an unexpected $400 bill out of their savings. 

Those headline numbers didn’t change much from 2022. But racial and ethnic gaps persisted, with Black and Hispanic SHED respondents continuing to report lower levels of financial security than white and Asian Americans.  

One group the published SHED report doesn’t tell us anything about: American Indians and Alaska Natives. 

If the Fed called up 25-year-old Maleah Nore to ask about her financial situation, she’d call it “precarious.” Nore is Tlingit from southeast Alaska but lives in Portland, Oregon. Last fall she quit her full time job and started putting herself through grad school with a couple of side hustles, including leading public health trainings for tribal governments and healthcare providers. 

“That’s all on a contract basis. I’m also a dog walker and I sell jewelry,” Nore said, so her income isn’t super predictable month to month. 

But she said she’s making ends meet, and would tell the Fed she’s doing “okay” financially. Just worse off than last year. And that $400 question doesn’t feel like a hypothetical. 

“You know what, my car’s a piece of crap and it breaks down like, three or four times a year,” Nore said. 

Right now, she could swing a surprise $400 expense without taking on credit card debt. In fact, she’d be relieved if her next mechanic bill came out to $400 or less. 

“I wish emergencies cost $400 these days, honestly,” Nore said. 

The SHED does capture responses from Native people like Nore, but they typically make up about 1% of the total sample. The Fed says that’s not enough to rigorously compare to other groups in its published report. That’s why most of the economic research you hear about on “Marketplace” doesn’t include breakout data for American Indian and Alaska Native consumers. 

“Those small sample sizes means that it’s trickier but still possible to get useful information about them,” said Ava LaPlante, a research assistant with the Minneapolis Fed’s Center for Indian Country Development. 

Ahead of this year’s SHED release, LaPlante and her colleagues pooled and analyzed nine years of publicly available but unpublished data on American Indian and Alaska Native financial well-being. That allowed them to overcome sampling limitations and draw some meaningful conclusions about how Native households are faring. 

“Generally, we find that American Indian and Alaska Native households experience consistently lower financial security than non-American Indian and Alaska Native households,” LaPlante said. 

Between 2014 and 2022, Native households were 20% less likely than average to report doing at least “okay” financially and 30% less likely to say they could afford that surprise $400 bill out of pocket. Even controlling for factors like age and education level, Native people reported less financial security than anyone else taking the survey.  

“I don’t think it’s that surprising,” said Randall Akee, an economist in the University of California, Los Angeles’s departments of public policy and American Indian studies. 

He said these findings track with what researchers know about lower average incomes, limited employment opportunities and poor credit access in many Native communities. But they can help bolster the case for funding and policy changes that might help. 

“I think tribal leaders, government officials that are interested in increasing access to capital, access to banking, this is the kind of evidence you want,” Akee said. 

Still, Akee said there are limitations to the Center for Indian Country Development’s analysis: It relies on about 110 responses per-year from respondents who checked the American Indian/Alaska Native box alone. That’s a relatively small sample and excludes as many as 60% of Native people who check more than one box on government forms. 

He said the federal government could invest in reaching more Native households by oversampling them in surveys like the SHED, the monthly jobs report others that drive economic news and policymaking. For now, researchers like him have to dig for imperfect and unpublished data. 

“You have to be creative in thinking about, okay, the perfect data doesn’t exist. However, how can I get close to that?” Akee said. 

That’s the kind of effort it takes to get a glimpse at what’s going on with Native consumers and tribal economies.