Penalties in the Safety Net: Economic Consequences of Work Requirement Enforcement

The Institute for Research on Poverty hosts seminars on the UW-Madison campus most Thursdays during the academic year. These presentations are free and open to the public. Room 8417.

media release: Speaker: Katherine Richard, assistant professor, La Follette School of Public Affairs, University of Wisconsin–Madison

Cash assistance in the United States promotes self-sufficiency through employment but imposes penalties that reduce or remove benefit income when participants violate work requirements. This seminar presents a paper quantifying the downstream consequences of not meeting work requirements using novel administrative data covering the full caseload of Michigan’s Temporary Assistance for Needy Families (TANF) program, combined with monthly enrollment records in the Supplemental Nutrition Assistance Program (SNAP) and Medicaid, as well as quarterly Unemployment Insurance earnings records. We estimate effects of violating work requirements and study a policy reform that increased the length of time families were removed from TANF after violating work requirements.  Findings indicate that sanctions reduce broader safety net attachment and increase economic instability for vulnerable families over the long-term.