Panel Paper: Job Loss and the Use of Public and Private Social Benefits: Evidence from the SIPP

Friday, November 8, 2013 : 9:45 AM
Mayfair Court (Westin Georgetown)

*Names in bold indicate Presenter

Elizabeth Crowe, American University
Families experiencing an economic shock such as sudden job loss, divorce, or parent leaving often seek assistance from the safety-net.  Aid available to these families is not limited to in-kind or cash assistance provided though government programs.  Non-profit community based organizations (CBOs), religious institutions, and family/ friends supplement benefits available through public assistance programs, creating a complex safety-net of public and private aid for those in need.  This study attempts to understand how families access this safety-net after experiencing an economic shock and what factors predict whether a family will access assistance.  I ask four testable research questions:
  1. What types of services do families access after experiencing an economic shock – ex: food, clothing, housing, or cash – and from what organizations?
  2. Do the types of services depend on the type of economic shock a family experiences or a family’s socio-economic status at the time of the shock?
  3. How long after experiencing an economic shock do families seek assistance?
  4. What factors predict whether a family experiencing an economic shock will access assistance?

I use the 2008–2011 Survey of Income and Program Participation (SIPP) to answer these questions.  I first identify families who experience job loss, divorce, or sudden illness in waves 1, 2 or 3 of the SIPP.  I follow families identified through the subsequent waves of the survey, observing as what point they access aid from the government, CBOs, and family/friends.

I use a multinomial logit to estimate what factors predict whether a family will access each type of assistance.  The model is defined as:

yit = β0 + β1xit + β2zit + εi

The dependent variable in the model, yit, is a set of binary indicators for accessing assistance from government, CBOs, or family/friends.  Accessing assistance includes receiving food, clothing, housing, and/or cash assistance from any of the named sources.  The model allows the respondent to choose all, none, or a combination of types of assistance from CBOs.  The independent variable, xit, is a vector of factors predicting whether low-income mothers will access multiple types of assistance at any given point in time.  Factors suck as social capital if the recipient, availability of services, and strictness of the program are drawn from the literature on take-up as well as CBOs.   A vector of controls is also included in the regression, zit

This is a particularly interesting survey because the data begins immediately after the most recent recession in February 2008, when caused a spike in job losses, and follows families through the recovery in 2011.  During this time, there was an increase in claims for unemployment insurance, however applications for assistance from welfare programs remained steady.  I hypothesize that families will turn first to family/friends and government programs such as unemployment insurance, then look to CBOs to supplement needs not met by aid programs.

I am a PhD candidate in Public Administration and Policy at American University.  This paper is part on my dissertation research on how families in need access services from the broader safety-net.