Technical Paper Public Supports When Parents Lose Work
Julia B. Isaacs, Olivia Healy
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At the peak of the recession, 18 percent of all children had at least one unemployed parent. Did benefits programs expand to meet these families’ needs? And how did millions of unemployed parents fail to receive any benefits despite the billions spent on unemployment insurance?

Key findings

  • During the recession, the number of children living with parents receiving unemployment insurance and SNAP benefits increased dramatically.
  • When parents lost work, higher-income children benefited most from unemployment insurance, while low-income children depended heavily on SNAP. 
  • Unemployment insurance receipt is lower among parents with less education, as well as among parents with less income.
  • Workers in low-skilled, low-wage jobs do not have good access to unemployment benefits. Trends are reversed for SNAP benefits.
  • The recession is not over for children. While unemployment rates have peaked, there were still 3 million more children living with parents who were unemployed in 2012 than in 2007.

Unemployment insurance and SNAP benefits greatly expanded during the recession. Between 2007 and 2009, the number of children whose parents received regular or extended unemployment benefits more than doubled. From 2010 and 2012, SNAP benefits reached nearly 15 million children living with unemployed parents each year. As entitlement programs, unemployment insurance and SNAP expanded automatically in response to newly eligible recipients, but Congress also passed the American Recovery and Reinvestment Act to expand them beyond built-in measures. Temporary Assistance for Needy Families (TANF) program showed very little sensitivity to economic conditions, serving only slightly more children in 2009–2011 than it had in 2007. Receipt of EITC, WIC and SSI were also less responsive.

Low-income children with unemployed parents depended heavily on SNAP benefits and had particularly low rates of unemployment insurance coverage. In 2012, among low-income children with unemployed parents, 77 percent benefitted from EITC, 58 percent from SNAP, and 65 percent from subsidized lunches. For higher-income children, unemployment insurance was the main support received when parents lost work.  Forty-one percent of children living with higher-income unemployed parents were supported by unemployment benefits at some point during the year, compared with 25 percent of low-income children. Higher-income families generally do not qualify for any public support programs other than unemployment insurance, though some may have benefitted moderately following drops in income.

Unemployment insurance receipt is lower among parents with less education, as well as among parents with less income. Only 18 percent of children whose unemployed parents had less than a high school diploma benefitted from unemployment insurance compared with 37 percent of children whose college-educated parents lost work.

Workers in low-skilled, low-wage jobs do not have good access to unemployment benefits. Some low-wage workers may not earn enough to qualify for unemployment insurance in their state, while some may fail to meet the nonfinancial qualifications for benefit receipt, assume they are ineligible, or may simply run out of benefits during a long unemployment spell. Though for low-income families that can get covered, unemployment benefits provide of an average of nearly $6,000 in benefits over the course of the year.

The recession is not over for children. Compared with 2007, in 2012, 3 million more children had an unemployed parent, 5.5 million more were receiving SNAP benefits and 1.7 million more were receiving unemployment insurance. Public benefit programs provide important supports to families and an economic stimulus, but reforms could increase coverage for those who need it most.

Policy recommendations

  • Improve unemployment insurance coverage for low-wage workers by expanding access, improving outreach and modifying circumstantial rules that ban benefits such as “voluntary quit.”
  • Amend TANF to make benefits more countercyclical by providing additional funds at times of high unemployment
  • Revisit Farm Bill amendments that would weaken SNAP provisions during times of high unemployment, limiting its capacity to support children and stimulate the economy.
Research Areas Social safety net Children and youth
Tags Temporary Assistance for Needy Families (TANF) Welfare and safety net programs Hunger and food assistance Economic well-being Unemployment and unemployment insurance Kids in context Families with low incomes