Joint Contributions of SNAP and Joint Contributions of SNAP and Unemployment Insurance Unemployment Insurance to the Social Safety Net: to the Social Safety Net: A Data Linkage ProjectA Data Linkage Project

John A. Kirlin and Michael WisemanJohn A. Kirlin and Michael WisemanSeptember 20, 2010September 20, 2010

Presented at APDU 2010 Annual Conference “Public Data 2010: Opportunities and Challenges for the New Decade”

Outline

• Background

• Study and research teams

• What is the policy issue?

• Study rationale

• Hypotheses and data needs

• Planned analyses and schedule

Background

• SNAP (formerly food stamps) is by far the largest food and nutrition assistance program in US

– Over 41 million participants in June 2010

– Over $5.5 billion in monthly benefits

• 12 months before “only” 34.9 million participants receiving $4.7 billion

Background

• Despite its popularity, only 2 of every 3 eligible individuals participates (2008)

• After years of research on SNAP/food stamp participation, we still do not understand all that we would like, e.g.:

– Why don’t all eligibles participate?

– How do people end up on SNAP? How do they leave?

Background

• In addition to the SNAP questions, what happens to individuals after their UI benefits end?

– Some find work

– Some retire (early retirement rising)

– Some go on public assistance

Background

• We are interested in the “some go on public assistance.” It’s a big unknown.

– How many?

– Who?

– For how long?

• Need longitudinal UI data matched to longitudinal SNAP data

The SNAP-UI Study

Joint Contributions of SNAP and Joint Contributions of SNAP and Unemployment Insurance Unemployment Insurance

to the Social Safety Net: to the Social Safety Net:

A Data Linkage ProjectA Data Linkage Project

Research Teams – States

1) Jacob France Institute – Maryland

• Andrew Young School – Georgia

• Chapin Hall Center – Illinois

• Upjohn Institute – Michigan

• Ray Marshall Center – Texas

2) California Institute of Public Policy – California

3) University of Missouri – Florida

Seven States

Policy Issue

• Economy is in a deep and protracted recession

• Existing assistance programs (UI, SNAP, TANF) have responded in different ways

• How can such programs improve their response to economic hardship?

• Can information about individuals’ use of UI and SNAP suggest ways to better serve unmet needs?

The EconomyThe worst recession since WWII

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Real and Potential Gross Domestic Product (GDP), 1949-2010

Potential GDP Real GDPSource: Federal Reserve Bank of St. Louis

Current RecessionLoss in GDP = $2,053.33 billion 2009 dollars

Unemployment has risen dramatically

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Unemployment Rate in the United States, Jan. 1976 - Aug. 2010 (seasonally adjusted)

Source: U.S. Bureau of Labor StatisticsShaded areas represent peak-to-trough NBER recessions.

The deficit of available jobs has increased drastically since early 2007

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Unemployed Persons Seeking Full-Time Work and Open Non-Farm Positions, Jan. 2001 - Jun. 2010 (seasonally adjusted)

Unemployed Persons, Looking for Full-Time Work

Open Non-Farm Positions

Mar. 2007: Deficit of 710 thousand jobs

Jun. 2002: Deficit of 4.4 million jobs

Oct. 2009: Deficit of 11.3 million jobs

Source: U.S. Bureau of Labor Statistics

Jan. 2001: Surplus of 252 thousand jobs

The SNAP caseload has grown in response to this recession (and every past recession)

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Number of SNAP and UI Claims, SNAP Claims as a Percentage of Population, and UI Claims as a Percentage of Labor Force, 1980-2009

Average Monthly SNAP Participants (left axis)

Number of Claims for Any UI Program (left axis)

Percentage of U.S. Population Receiving SNAP (right axis)

Percent of Labor Force Collecting UI Benefits (right axis)

Sources: National Bureau of Economic Research, USDA Food and Nutrition Service, U.S. Census Bureau, U.S. Department of Labor. Shaded areas represent peak-to-trough NBER recessions.

But relatively few SNAP households collect UI and SNAP at the same time

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SNAP Households with Unemployment Income, 1997 - 2008

Total Number of SNAP Households (left axis)

Percentage of SNAP Households with UI (right axis)

National Unemployment Rate (right axis)Sources: USDA Food and Nutrition Service and U.S. Bureau of Labor Statistics

Rationale for the Study

• Historically, the relationship between SNAP and UI has been tenuous, but

– Do households sequence their UI and SNAP receipt?

– Given the severity of the current recession, is the relationship changing?

– Most important part of the relationship is probably dynamic, not cross-sectional

Rationale for the Study

• We do not know about the dynamic interaction between the two programs

• This project intends to go to the state level to understand the past and evolving relationship between SNAP and UI, in order to improve SNAP administration and access

Possible Scenarios:No UI Benefits

Earnings → SNAP → Earnings

Possible Scenarios:Non-overlapping Spells

Earnings → UI → SNAP → Earnings

Possible Scenarios:Overlapping Spells

Earnings →UI → UI/SNAP → SNAP

Why the SNAP/UI relation may be changing

• Worst recession since Great Depression

• A large proportion of job losses in this recession has been a result of layoffs, making local re-employment more difficult

• Changed eligibility rules--broad-based categorical eligibility for SNAP essentially eliminates asset limits for many potential applicants

Research Hypotheses

1) Both the concurrent and sequential links between UI and SNAP grow during recessions.

2) Over time, the likelihood of taking up SNAP in conjunction with UI has increased, and the lag between initiation of UI and SNAP take-up has declined.

3) There is a large group of people who are collecting UI and may be eligible for SNAP, but who are not receiving SNAP benefits.

Data Needs

• Need access to longitudinal and matched data on SNAP and UI participation to test previous hypotheses

• Available data are limited

– Administrative data for SNAP and UI are maintained at the state level; the federal government only has access to a cross-sectional sample of the SNAP data

Solution

• Turn to researchers who:

– Have access to state data

– Have experience processing and analyzing large data sets

– Are knowledgeable of the issues

7 States and 7 Research Teams

These 7 states face diverse economic situations

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Unemployment Rates in the Seven Project States, 1976-2010 (seasonally adjusted)

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U.S.

Sources: U.S. Bureau of Labor Statistics and the National Bureau of Economic Research.Shaded areas represent peak-to-trough NBER recessions.

Three Levels of Planned Analysis

• Level 1 covers the foundational question of the project: What is the intersection of SNAP and UI?

– Divided into two parts:

• Cross-sectional over 2006 - 2010

• New SNAP entrant cohorts over 2006-2010

– Each looking backward and forward at UI wage coverage and claims receipt

Level 2 Analyses

• Level 2 repeats the Level 1 analyses for specific subgroups of the SNAP population

– Individuals (age, gender, citizenship, race/ethnicity, work/earnings history)

– Households (size, type, composition, spell length, metro/rural, income sources, and gross and net income amounts)

Level 3 Analyses

• Level 3 offers opportunities for researchers to address issues that are particular to:– Their unique data strengths– The needs of the SNAP or UI programs in

their state

Challenges

• Getting permission from multiple state agencies to have their data matched and used by outside researchers– Our teams have prior experience working with their

states so a level of trust already exists

• Getting consistent data for similar time periods from all states

• Using consistent definitions, especially given:– Weekly, monthly, quarterly time periods for data

Study Schedule

• Finish data prep by late fall

• Analyses over winter

• Individual reports to ERS in the spring/summer

• ERS summary report thereafter

Joint Contributions of SNAP and Unemployment Joint Contributions of SNAP and Unemployment Insurance to the Social Safety Net: Insurance to the Social Safety Net:

A Data Linkage ProjectA Data Linkage Project

Thank you