Association for Public Policy Analysis & Management

Poverty is associated with numerous negative short-term and long-term outcomes, but living below a certain income threshold does not capture the entirety of a family’s economic well-being. Income instability is another important indicator of economic well-being that may have unique implications for low-income families. Studies have provided evidence for the rise of income instability in recent decades, particularly amongst low-income families (Hardy & Ziliak, 2014; Gennetian & Shafir, 2015). And other work suggests that experiencing a volatile income has negative consequences for families’ economic and social well-being (Barr, 2012; Gennetian et al., 2015). As income instability has risen over the past few decades, so has family structure complexity and relationship instability. Despite the evidence for the growth of both income and relationship instability within low-income families, there is limited research examining the direct, potentially cyclical relationship between the two instabilities. Moreover, insofar that income instability and relationship instability have implications for welfare benefit receipt, it is particularly important to understand how instability is associated with changes in welfare receipt for low-income families. This study examines intra-year patterns and associations of income instability, relationship instability, and changes in welfare benefit receipt using a longitudinal, panel study called the New York City Longitudinal Survey of Wellbeing. Measures of income instability, relationship instability, and welfare benefit changes are measured every three months, and cross-lagged structural equation modeling (SEM) is used to investigate associations between instabilities at these frequent time points. Results suggest that income instability has a strong, positive association with income instability and relationship instability over time. Relationship instability has a less consistent impact on relationship instability over time, and it rarely demonstrates a significant relationship with income instability. Interestingly, associations between significant income drops and gaining welfare benefits are mostly negative and significant. This suggests that safety net programs are not being responsive to severe income changes for low-income families. Similarly, a small but significant positive association between relationship dissolution and losing welfare benefits is found at multiple time points. Thus, relationship dissolution may put low-income families at-risk of losing welfare benefits. These findings give preliminary evidence that the social safety net is not adequately responding to instability for low-income families. Implications for policy and practice are discussed.