Food Stamp Participation and Employment among Adult-Only Households

David C. Ribar – The George Washington UniversityMarilyn Edelhoch – South Carolina Department of Social Services

Qiduan Liu – South Carolina Department of Social Services

Two gaps in the FSP literature

Relatively little FSP research on adult-only households Most previous research has either examined

families with children, especially single-parent families, or the caseload as a whole

Participation behavior among adult-only HHs is different low take-up among elderly long spells for those who do participate

Adult-only HHs are also a focus of policy simplified application procedures for elderly & disabled new work requirements and time limits for able-bodied adults

without dependents (ABAWDs)

Gaps in FSP research (cont.)

Little research on FSP policies and procedures Benefits follow a national formula, only variation in

formula is in Alaska and Hawaii Administration, however, is left to the states Policies are difficult to measure and usually only

apply to select groups Hard to examine with most national data sets Would also seem to be difficult to measure within a

single state; however, there are two important aspects of policy in South Carolina that can be readily measured

ABAWD policies

From PRWORA, ABAWDs had to work or participate in work-related activities otherwise could only receive benefits for 3 months in

any three years At their discretion, states could exempt ABAWDs

living in high unemployment areas States later given discretion to exempt up to 15

percent of their ABAWD caseload South Carolina used its discretion to exempt entire

counties (mostly) mix of counties changed somewhat over time all counties exempt after Oct. 2002

South Carolina Counties Exempt from ABAWD Work Requirements 1996 – 2003

Effective Labor Surplus Areas High Unemployment Areas 15% Exemption Areas

December 1, 1996 Abbeville, Allendale, Bamberg, city of North Charlestown, Chester, Chesterfield, Clarendon, Colleton, Darlington, Fairfield, city of Florence, Hampton, Kershaw, Lee, McCormick, Orangeburg, city of Sumter, Union

Barnwell, Dillon, Georgetown, Marion, Marlboro, Williamsburg

March 1, 1998 Aiken, Allendale, Bamberg, Barnwell, Calhoun, city of North Charlestown, Chesterfield, Clarendon, Colleton, Darlington, Dillon, Edgefield, Fairfield, Florence, Hampton, McCormick, Orangeburg, Union

Chester, Georgetown, Lee, Marion, Marlboro, Williamsburg

Charleston (balance of county)

August 1, 1999 Abbeville, Aiken, Allendale, city of Anderson, Bamberg, Barnwell, Calhoun, city of North Charlestown, Chester, Chesterfield, Clarendon, Darlington, Dillon, Fairfield, Florence, Georgetown, Hampton, Lee, McCormick, Marion, Orangeburg, Union

Marlboro, Williamsburg Anderson (balance of county), Charleston (balance of county)

April 1, 2000 Allendale, Bamberg, Barnwell, Chester, Chesterfield, Clarendon, Darlington, Dillon, Fairfield, Georgetown, Lee, McCormick, Orangeburg, Union

Marion, Marlboro, Williamsburg Abbeville, Aiken, Anderson, Calhoun, Charleston, Florence, Hampton

April 1, 2001 Allendale, Bamberg, Barnwell, Calhoun, Chester, Chesterfield, Clarendon, Darlington, Fairfield, Georgetown, Greenwood, Lee, McCormick, Orangeburg, Union

Dillon, Marion, Marlboro, Williamsburg Abbeville, Aiken, Anderson, Charleston, Florence, Hampton

April 1, 2002 Allendale, Bamberg, Barnwell, Calhoun, Chester, Chesterfield, Clarendon, Darlington, Georgetown, Greenwood, Lee, McCormick, Orangeburg, Union

Dillon, Fairfield, Marion, Marlboro, Williamsburg

Abbeville, Aiken, Anderson, Charleston, Florence, Hampton

October 1, 2002 Allendale, Bamberg, Barnwell, Calhoun, Chester, Chesterfield, Clarendon, Darlington, Georgetown, Greenwood, Lee, McCormick, Orangeburg, Union

Dillon, Fairfield, Marion, Marlboro, Williamsburg

Rest of state

May 1, 2003 Abbeville, city of Anderson, Barnwell, Cherokee, Chesterfield, Clarendon, Darlington, city of Florence, Georgetown, Greenwood, city of Sumter

Chester, Fairfield, Laurens, McCormick, Marion, Marlboro, Orangeburg, Union, Williamsburg

Rest of state

FSP recertification FSP eligibility is based on monthly criteria; however, these are

hard to check Instead, clients need to “recertify” their eligibility either in-person

or by mail regularly; states vary in their recertification intervals South Carolina distinguishes between HHs with fixed and

fluctuating incomes HHs with fixed incomes need to recertify annually Prior to Oct. 2002, HHs with fluctuating incomes needed to

recertify quarterly Since Oct. 2002, HHs with fluctuating incomes need to

recertify semi-annually Elderly and disabled HHs with fixed incomes have easier

recertification requirements than other HHs

Identification of policy effects

Typically, it is difficult to identify policy effects within a single state

For ABAWD policies, county variation in exemption status variation in the expected timing of effects (should appear

early in a spell) can examine a psuedo-control group of older adult-only HHs

For FSP recertification, effects occur relative to the start of a participation spell and

thus can be seen in the spell duration pattern change in policy in Oct. 2002 also, differences by initial income status

Food Stamp Caseload Trends

South Carolina Food Stamp Caseload and Unemployment Rate

100,000

120,000

140,000

160,000

180,000

200,000

220,000

240,000

Fo

od

Sta

mp

Cas

elo

ad

3

3.5

4

4.5

5

5.5

6

6.5

7

7.5

Un

emp

loym

ent

Rat

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Food Stamp

Unemployment

Data

We examine administrative records for FSP spells that began after Oct. 1996; data extend through Dec. 2003

Construct spells of participation or non-participation data measured to the day eliminate short breaks and short spells drop spells that were on-going as of Oct. 1996 participation & non-participation spells may be repeated

Covered employment construct indicator for whether case head earned more than

$250 in a quarter misses some jobs – agriculture, out of state lack detailed timing information, just use quarterly indicators

Data (continued)

Other personal and family controls include race, age, gender, education, marital status

County measures: unemployment, population density, border county, ABAWD exemption

Only examine cases without dependent children To reduce sample size, examine 1 out of every 11

cases Separate analyses conducted for HHs with and

without members under age 50 (with and without potential ABAWDs) 9,264 households with members under age 50 4,550 households with no members under age 50

FSP exit hazards for different cohorts & types of households

Adult-only HHs with members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

Adult-only HHs with members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

Adult-only HHs with no members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

Adult-only HHs with no members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

FSP survival functions for different cohorts & types of households

0.00

0.25

0.50

0.75

1.00

0 3 6 9 12 15 18 21 24 27 30 33 36

Adult-only HH <= 50 Adult-only HH > 50 HH with children

0.00

0.25

0.50

0.75

1.00

0 3 6 9 12 15 18 21 24 27 30 33 36

Adult-only HH <= 50 Adult-only HH > 50 HH with children

Spells began before 2000 Spells began after June 2002

FSP exit hazards by entry cohort and income type

Spell began between July & December 2001with a fluctuating income

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30

Spell began between July & December 2001with a fixed income

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30

Spell began after June 2002with a fluctuating income

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30

Spell began after June 2002with a fixed income

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30

FSP exit hazards by county ABAWD exemption status

Adult-only HHs with members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

Lives in non-exempt county Lives in exempt county

FSP exit hazards by county ABAWD exemption status

Adult-only HHs with no members under age 50

0.00

0.03

0.06

0.09

0 3 6 9 12 15 18 21 24 27 30 33 36

Lives in non-exempt county Lives in exempt county

Multivariate analyses

Jointly estimate multivariate models of food stamp participation spells food stamp non-participation spells employment outcomes

Models control for problems from omitted variables and endogenous explanatory variables

Models estimated separately for HHs with and without members under age 50

Food stamp exits

Hazard model for food stamp exits

ln hFS(t) = AFS′TFS(t) + δFSE(t) + BFS′XFS(t) + η (1)

proportional hazard specification TFS(t) is a vector of duration variables, including spell

duration, calendar time and recertification indicators; spell duration controls interacted with ABAWD exemption status

E(t) is an indicator for employment XFS(t) is a vector of other observed explanatory variables η is an unobserved, time invariant variable; η ~ N(0, ση

2) AFS, δFS and BFS are coefficients to be estimated

Employment is endogenous; assumed to be correlated with η

Food stamp re-entry

Hazard model for food stamp re-entry

ln hNF(t) = ANF′TNF(t) + δNFE(t) + BNF′XNF(t) + μ (2)

proportional hazard specification with E(t) and XNF(t) defined as before

vector of duration variables, TNF(t), only includes controls for spell duration and calendar time

μ is an unobserved, time invariant variable; μ ~ N(0, σμ2);

correlated with η (ρημ) ANF, δNF and BNF are coefficients to be estimated

Employment is again endogenous Estimation procedure allows for multiple, alternating spells of

food stamp participation and non-participation

Employment

Longitudinal earnings/employment model

E*(t) = BE′XE(t) + ν + ε(t), E(t) = 1 if E*(t) > 0 (3)

random effects probit model ν is an unobserved, time invariant variable; ν ~

N(0, σν2); correlated with η and μ (ρην and ρμν)

Equations (1)-(3) estimated jointly; because of repeated observations, numerous outcomes examined per case

Gaussian quadrature used to evaluate η, μ and ν; 10 evaluations in each dimension (1000 evaluations total)

Estimation results – simulated change in ABAWD exemption status, HHs with members < age 50

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30 33 36

PI not employed; household in exempt county

PI not employed; household in non-exempt county

Estimation results – simulated change in employment, HHs with members under age 50

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30 33 36

PI not employed; household in exempt county

PI continuously employed; household in exempt county

0.00

0.03

0.06

0.09

0.12

0 3 6 9 12 15 18 21 24 27 30 33 36

PI not employed; household in exempt county

PI continuously employed; household in exempt county

Spell begins in January 1997 Spell begins in July 2002

Estimation results – simulated change in emp. & age comp., HHs with no members under age 50

Spell begins in January 1997 Spell begins in July 2002

0.00

0.01

0.02

0.03

0.04

0.05

0.06

0 3 6 9 12 15 18 21 24 27 30 33 36

PI not employed; household contains a member under age 60

PI continuously employed; household contains a member under age 60

PI not employed; all household members over age 60

0.00

0.01

0.02

0.03

0.04

0.05

0.06

0 3 6 9 12 15 18 21 24 27 30 33 36

PI not employed; household contains a member under age 60

PI continuously employed; household contains a member under age 60

PI not employed; all household members over age 60

Conclusions

Recertification is important: more frequent recertification reduces FS participation and shortens spells

ABAWD restrictions shorten FSP participation spells reduce FSP re-entry BUT have only modest effects on employment

Dogs that don’t bark: policy effects appear where they are supposed to but not where they shouldn’t

Employment reduces FS spells