If you’ve been following recent news in Ģ����Ƶ about the —better known as SNAP or food stamps—you might have heard an alarming number: 

Ģ����Ƶ’s SNAP payment error rate was 15.21% in 2025.

�ճ󲹳�’s . And under new federal rules, it could cost Ģ����Ƶ hundreds of millions of dollars.

So what does the error rate mean for taxpayers, families, and the people who administer SNAP?

And what are Ģ����Ƶ lawmakers doing to reduce it?

What Does the SNAP Error Rate Measure?

A SNAP payment error happens when a household receives more or less in benefits than it should have. In 2025, 13.62% of Ģ����Ƶ’s SNAP payments were overpayments, and 1.59% were underpayments. Added together, these two percentages total the state’s error rate.

In April of 2025, about 1.88 million Ģ����Ƶns relied on SNAP assistance to feed their families. That means that over 255,000 payments were too high, while about 30,000 were too low.

It’s important to note that making an error isn’t the same thing as committing fraud. Fraud is intentional. SNAP payment errors are usually unintentional and can happen when a household’s information changes, an eligibility worker makes a mistake, or the system that administers the program calculates benefits incorrectly.

Why Is the Error Rate Getting Attention Now?

The federal government has historically paid the full cost of SNAP benefits.

But with the passage of the in 2025, most states with SNAP error rates of 6% or higher will have to pay a share of their residents’ benefits starting in October of 2027. The higher the error rate, the higher the state’s share will be:

• Error rate below 6%: state will pay 0% of SNAP benefits
• Error rate from 6% to 8%: state will pay 5% of SNAP benefits
• Error rate from 8% to 10%: state will pay 10% of SNAP benefits
• Error rate of 10% or higher: state will pay 15% of SNAP benefits

At Ģ����Ƶ’s current SNAP payment error rate of 15.21%, the state could soon face a cost of about $500 million a year to make sure everyone receives their payments. 

This creates a big potential burden for taxpayers because Ģ����Ƶ could have to raise taxes or cut public services to increase revenues enough to pay the state’s share of SNAP benefits. 

For families who use SNAP payments to help put food on the table, the discovery of an incorrect benefit amount—either too high or too low—could create uncertainty as they work to manage a tight budget. They might be especially worried about having to pay something back if they’ve been receiving overpayments. 

The high error rate also has SNAP recipients wondering whether they’ll face changes to eligibility requirements or even reduced access to the program if the state isn’t able to cover all the new costs.

But the federal government has granted Ģ����Ƶ and other states with error rates over 13.34% permission to delay the start of their SNAP cost-sharing until October of 2028. 

That extra year creates a window of opportunity for Ģ����Ƶ’s leaders to address the issue, but they still need to act quickly.

What Can Ģ����Ƶ Do to Reduce Its Error Rate?

Lawmakers are already making key changes that should lower Ģ����Ƶ’s SNAP error rate: 

• They increased funding for SNAP in the new state budget that took effect in July of 2026, including $6.9 million specifically dedicated to reducing the error rate. 
• They’re expanding administrative staff training on the complicated SNAP eligibility rules and empowering case workers to conduct more thorough case reviews. 
• They’ve submitted waiver requests to the federal government to allow the state to automate more of the eligibility process.

Moving forward, state leaders are also planning to improve , the online system Ģ����Ƶns use to apply for and manage SNAP and other public benefits. Better technology should make it easier for families to submit information correctly and for eligibility workers to process cases accurately.

And as lawmakers implement these SNAP system improvements, they could also explore . That would make it easier for someone receiving public assistance to gain skills, find a job, and become self-sufficient—so they can thrive without welfare benefits.

What’s the True Measure of a Successful Welfare Program?

Safety net programs like SNAP are vital to the well-being of people and communities across Ģ����Ƶ. They support individuals and families when they face challenges like disabilities or temporary hardships. 

So it’s crucial that these programs operate correctly, but it’s also essential to make sure they achieve their ultimate goal. 

After all, the true measure of a program’s success isn’t just a low error rate—it’s the ability of that program to help break cycles of poverty and make it easier, not harder, for Ģ����Ƶns and their families to flourish.

Additional Resources

Alliance for Opportunity

CBS News

Ģ����Ƶ Budget & Policy Institute

Ģ����Ƶ Recorder

U.S. Food and Nutrition Administration

U.S. Food and Nutrition Administration

U.S. Food and Nutrition Administration

The post What Is Ģ����Ƶ’s SNAP Error Rate? And What Can Policymakers Do Ģ����Ƶ It? appeared first on For Opportunity.

In many ways, Ģ����Ƶ’s economy is booming.

The state is attracting top-tier businesses, and more Ģ����Ƶns are working than ever before. In June of 2026, almost 5.3 million people held jobs in Ģ����Ƶ. The state’s unemployment rate was also just 3.4%, well below the national average of 4.2%.

And as of the end of 2025, Ģ����Ƶ had about 275,000 job openings.

That all sounds like great news—and it is.

But strong employment numbers don’t tell the whole story.

Many of Ģ����Ƶ’s job-seekers are still wrestling with a big question: “Where can I find a job I can actually get, keep, and live on?”

The Everyday Challenges of the Job Search in Ģ����Ƶ

A lack of motivation is rarely what stands between Ģ����Ƶns and meaningful work. 

Instead, many people are having a hard time figuring out which educational and training programs will open doors to available jobs. They may have general education backgrounds but not the specific skills, certifications, or hands-on experience today’s employers are looking for.

And finding a job that matches a job-seeker’s qualifications is only part of the equation. An employment opportunity also has to work with the realities of their everyday life. Families across Ģ����Ƶ can face barriers to work involving: 

• Access to child care
• Transportation to work
• Re-entry into the workforce after incarceration
• Disability-related challenges
• Distance to resources and good jobs for those in rural areas

These hurdles can make a seemingly good job much harder to take—or to keep—and families have to figure out whether the potential paycheck would really make them better off. 

The income alone might not be enough to overcome the obstacles people struggle with. It could even cause an individual or family to face a benefit cliff, where a small increase in earnings leads to a much bigger decrease in welfare (safety net) support.

There are currently about 800,000 Ģ����Ƶns who aren’t working full time, including:

• Unemployed people who are looking for jobs
• Part-time workers who want to work full time
• People who have given up looking for work

For many of these individuals, the challenges of the search for rewarding full-time work can be complicated and overwhelming. Despite their efforts, they may feel stuck, discouraged, and unsure of how to move forward.

How State Leaders Can Build a Better Path to Work

Ģ����Ƶ policymakers can take much-needed steps to improve the job-search process and help connect more people to promising jobs:

1. Align Workforce Development Programs with Employer Demand: People shouldn’t spend months completing an educational program only to discover there are few openings that they’re qualified for. To prevent this, Ģ����Ƶ’s workforce development programs can coordinate with schools, technical colleges, and employers to structure education and training opportunities so they equip Ģ����Ƶns with the in-demand skills that lead directly to fulfilling careers.
2. Remove the Obstacles That Keep People from Working: To help those who face barriers to work, Ģ����Ƶ lawmakers can continue exploring a to managing government benefits and workforce services. By better integrating welfare and workforce development programs, policymakers can empower state agencies to address beneficiaries’ needs more holistically—connecting people to work while making sure they get the vital support that will enable them to take a job.
3. Make Quality Child Care More Accessible: Ģ����Ƶ’s leaders can help make child care more affordable and available by taking a careful look at rules that may unintentionally make it harder and more expensive for providers to serve families. By considering regulatory changes while preserving quality and safety, policymakers can enable new providers to enter the market, give parents additional choices, and help working families find care that fits their lives. 
4. Eliminate Benefit Cliffs: To reward rather than penalize people’s efforts to work, policymakers can eliminate benefit cliffs by gradually decreasing public assistance as workers earn more. This will encourage people to take meaningful jobs, accept promotions, or work more hours without fear of a steep drop in critical support.

How Local Communities Can Open Doors for Job-Seekers

Nonprofits, churches, and other community groups can also take action to help close the gap between Ģ����Ƶ’s employment numbers and the reality many families experience:

1. Connect Job-Seekers to Employers: Community organizations can work together to identify people who are struggling to find or keep jobs and provide them with access to local work readiness programs and businesses that are hiring. 
2. Help Employers Find Candidates: Just as importantly, community groups can learn what local employers actually need and help them connect with qualified candidates they might otherwise miss. 
3. Provide Continuous Support to Working Families: Getting a job is just one step toward stability and prosperity. Communities can continue to encourage their neighbors and help them adapt as they start new jobs and adjust their family routines. 

The Real Measure of Economic Growth

Ģ����Ƶ has successfully attracted new employers and become a destination for major investments. But the real measure of economic growth isn’t how many jobs are available. It’s whether Ģ����Ƶns can access those jobs and turn them into flourishing lives.

A good job should do more than cover today’s bills. It should create tomorrow’s opportunities. It should make it easier to support a family, save for important purchases, and open doors to upward mobility.

When policymakers and communities come together to help job-seekers, a strong economy can be something even greater: a pathway to stable, family-sustaining work and a brighter future for Ģ����Ƶns across the state.

Additional Resources

Alliance for Opportunity

Alliance for Opportunity

City Journal

Federal Reserve Bank of St. Louis

Federal Reserve Bank of St. Louis

Ģ����Ƶ Center for Opportunity 

Non-Working Adults Concentrated in Ģ����Ƶ’s Distressed Communities

Ģ����Ƶ Center for Opportunity 

Ģ����Ƶ Department of Labor

Governor Brian P. Kemp, Office of the Governor

U.S. Bureau of Labor Statistics

The post Ģ����Ƶ Has 275,000 Open Jobs—Why Is Getting One So Hard? appeared first on For Opportunity.

Millions of Americans rely on government-run safety net programs to help meet their fundamental needs. Also known as “welfare programs” or “public assistance,” safety net programs include the , the (SNAP or food stamps), , housing assistance, and childcare support, among many others.

These programs are meant to temporarily support individuals and families going through tough times as they rise above the poverty level and become self-sufficient again.

But these safety nets often function more like snare nets, trapping people in a complex web of formulas and rules that prevents them from taking and keeping promising jobs that would lead to a better future.

Frankie, a young woman who moved to Ģ����Ƶ for a new start, found herself in this very situation. She felt forced to turn down a great job that would have paid $70,000 per year. She needed the job, but she also needed the public assistance that would help her find an affordable home for her family. The new income would have made her ineligible for that crucial housing support.

How is it possible that well-intentioned government assistance programs are actually reinforcing cycles of poverty? People like Frankie who receive safety net support are facing harmful barriers to opportunity called “benefits cliffs.” This critical flaw in welfare programs discourages work and upward mobility and keeps people stuck in long-term cycles of government dependency.

What are benefits cliffs?

Many low-income workers experience , sometimes called “welfare cliffs.” In these disheartening situations, a small increase in earnings leads to a sudden and sharp decrease in, or even a total loss of, public assistance.

The higher wages push a worker’s income over the eligibility limit for one or more safety net programs, causing the abrupt loss of essential benefits. This leaves people worse off financially, despite doing everything right to get ahead.

Who do benefits cliffs affect?

Benefits cliffs, and their severity, depend on many factors. The number of people in a family, how much each person earns, and where they live can all play a role. Low-income working parents with young children are especially vulnerable to benefits cliffs because they frequently rely on multiple safety net programs to protect their family’s well-being.

A detailed developed by the Ģ����Ƶ Center for Opportunity provides many scenarios showing how benefits cliffs can affect a family’s net earnings.

Let’s consider the situation of a working mother with two young children in Ģ����Ƶ who’s receiving benefits from five welfare programs:

• If she earns $12.50 per hour from her full-time job, her combined income from wages and public assistance will total about $45,000 annually.
• If she earns just 25¢ more per hour, she’ll face a net loss in income of almost $1,500 per year because of reduced safety net benefits.
• If she gets a slightly bigger raise of $1.25 per hour, she’ll lose so much in welfare benefits that her net income will decrease by a staggering $15,000 per year. That loss will pose a huge risk to her family’s health and financial stability.

What are the impacts of benefits cliffs?

Many public assistance recipients find themselves in deeply worrying circumstances after they take a better-paying job or accept a raise. Their income has increased too much to qualify for benefits, but it’s still not high enough to cover all their family’s essential needs like food, healthcare, housing, and childcare. In this demoralizing situation, people often feel like they’re being punished for trying to break free from government dependency.

Effects on career development

When individuals don’t accept fulfilling career opportunities, they lose the vital sense of dignity, purpose, and well-being that meaningful work and upward mobility provide.

“It makes you feel hopeless,” said . Carlotta was offered a rewarding job at a broadcast network in Ģ����Ƶ, but she instead took a lower-paying job that wouldn’t put her much needed medical benefits at risk.

Implications for mental health

Benefits cliffs can impact mental health in many ways as well. For example, , a working mom, struggled to afford housing after her income increased above the eligibility limit for public assistance. Rather than being excited about her advancing career, Joyelle felt scared. Her fears of not being able to take care of her family were “devastating” for her well-being, and she suffered from severe anxiety, stress, and depression.

Consequences for employers and communities

The negative impacts of benefits cliffs also spread to employers and local communities. When people are disengaged from work, businesses find themselves constantly hiring rather than building a strong, stable, and efficient workforce that can help the surrounding community grow and thrive.

How can policymakers address benefits cliffs?

Safety net programs help people survive on a basic level, but they don’t currently empower welfare recipients to rise above the poverty line so they can flourish and reach their true potential.

As Frankie asked of the safety net system, “Do you want me to really be better, or do you want me to really be poor?”

To solve this critical issue and reward progress rather than penalizing it, policymakers should eliminate benefits cliffs by gradually decreasing public assistance as workers earn more. This will encourage individuals to take meaningful jobs, accept promotions, or work more hours without fear of a benefits cliff. In addition, gradual benefit reductions will give families time to make financial plans as they move toward self-sufficiency.

Removing barriers to work also allows people to experience the powerful sense of dignity, purpose, and confidence that comes from a rewarding job and financial independence. And when people take jobs that confirm their inherent value and potential, it transforms not only their lives, but the lives of their family members as well.

As workforce participation increases, businesses can also hire and promote more workers. This will stabilize their staff and reduce inefficiencies that high turnover rates can cause. A thriving local economy will then lift and strengthen the entire community.

Research has shown that work is one of the key factors in breaking the cycle of poverty. It’s a gateway to a better future where people and communities can flourish. To open these doors, policymakers need to make changes, ensuring that benefits cliffs are no longer barriers on the pathway to opportunity.

Personal stories: What it’s like to face benefits cliffs

Frankie’s story

Frankie moved to Ģ����Ƶ for a new start. Instead, she faced a heartbreaking choice. Say “yes” to a good job offer, and she would become ineligible for the housing assistance she needed to get on her feet.

Joyelle’s story

Joyelle needed to fall back on public housing during a tough time in her life. She was determined to get back on her feet. After going back to school, she was offered an exciting full-time job with the state of Ģ����Ƶ. �ճ󲹳�’s when Joyelle got a shocking surprise: due to her new salary, her subsidized housing allowance disappeared overnight and left her feeling further behind than ever.

Additional resources

American Public Human Services Association

The Black Chronicle

Fed Communities

Federal Reserve Bank of Atlanta

Federal Reserve Bank of Atlanta

Forbes

Foundation for Research on Equal Opportunity

The Benefits Cliff
Ģ����Ƶ Center for Opportunity

Confirmed. Welfare Cliffs Pervasive in 8 Southeast States
Ģ����Ƶ Center for Opportunity

Disincentives for Work and Marriage in Ģ����Ƶ’s Welfare System
Ģ����Ƶ Center for Opportunity

If You Accept This Raise, You Fall Off the Welfare Cliff
Ģ����Ƶ Center for Opportunity

Nonfinancial Impact from Nonwork
Ģ����Ƶ Center for Opportunity

Solving the Food Assistance (SNAP) Benefits Cliff
Ģ����Ƶ Center for Opportunity

Welfare Cliffs Exist—Concludes Team of Economists
Ģ����Ƶ Center for Opportunity

National Conference of State Legislatures

National Conference of State Legislatures

Sutherland Institute

The post Understanding Benefits Cliffs appeared first on For Opportunity.

Key Takeaways:

• Welfare cliffs and marriage penalties are discouraging people from work and forming families.
• The cliffs and penalties may mean that our clients are locked into poverty for much longer than they would be otherwise and despite our best efforts.
• GCO has created that allows anyone to see when a particular family can expect to experience benefit cliffs as they earn more money through work.��

Important Link:

If you work in a nonprofit serving the poor, you need to know that the government benefits your clients receive are likely discouraging them from working or forming a family, two things shows could lift them out of poverty the fastest.��

This is an especially tough problem for nonprofits, like GCO, that work to get their clients into good-paying jobs and strengthen their family relationships.

What’s going on?

These disincentives to work are often called “welfare cliffs” and the disincentives to family formation are called “marriage penalties.” Essentially, “cliffs” are generated any time a person receiving government benefits gets a raise at work that causes them to lose more in benefits than they will earn in additional income from the raise. These same individuals can face a similar financial penalty IF they decide to marry. In many cases, they will lose more in benefits than their spouse is able to provide in new income to the household.

While you would think (hope?) cliffs and penalties are rare, they are not. Instead, they are baked into the structure of nearly all welfare programs and many of the cliffs are severe. It’s also important to know that welfare recipients don’t face a single cliff or a single penalty, but they face cliffs and penalties at a number of different points as they have additional income from working or through marriage.

Why does it matter?

For nonprofit leaders, the cliffs and penalties may mean that our clients are locked into poverty for much longer than they would be otherwise and despite our best efforts. For workforce development nonprofits, cliffs could be the underlying reason why your clients don’t pick up additional work hours when they are offered or seem less than excited when they are offered a good promotion. In extreme cases, clients may quit jobs that seemed like a perfect fit simply because they panic when they learn they may lose a major benefit – like housing or childcare.

For nonprofits trying to help strengthen family relationships, marriage penalties may be driving behavior that is otherwise inexplicable, like seemingly happy couples refusing to marry or live in the same home. These dynamics can lead to stress for the couples affected and to a sense that a parent (usually the father) has abandoned the family when, if the system would allow it, he would be in the home. In these cases, children pay the biggest price.

What can you do about it?

Fortunately, we have created that allows anyone to see when a particular family can expect to experience benefit cliffs as they earn more money through work. For nonprofits working with these families, you now have a tool (available for 10 states, with two more on the way) that will allow you to help your clients plan for the future. In some cases, knowing when cliffs are likely to happen will allow your clients to seek a larger raise that will help them bypass or leapfrog a cliff. In other cases, maybe the answer is seeking additional training or certifications that will get your client into a different payscale entirely – one that avoids the cliffs.

In the coming weeks, we will be adding a tool that will allow users to see the impact of penalties on couples who decide to marry. We will also be incorporating a solutions tool that will allow anyone to see how reforming our government benefit programs can actually eliminate cliffs and penalties entirely, giving recipients every reason to pursue work and form stable households.

For GCO, it is this last point – reforming the system – that remains the ultimate goal. In the meantime, we are looking for ways to mitigate the harm caused by the welfare system, so that as many people as possible can escape the system and break cycles of poverty now.

The Success Sequence provides an outline of how to reverse the cycle of poverty in our communities. GCO uses this as a framework for much of our work.

The post Why Nonprofits Should Care and What to Do appeared first on For Opportunity.

During a focus group session on working class families we recently conducted at the Ģ����Ƶ Center for Opportunity, Jazmine* made an observation more perceptive than most experts.

Our focus group consisted of working-class African-Americans who did not have a college degree and who were not employed in a managerial position nor on track to become a manager.��

Knowing financial stress up close, Jazmine essentially said that either the minimum wage should be increased or the cost of living should be lowered.

Her observation is a perfect segue from my prior blogs on:

• the empirical economic evidence against the minimum wage,��
• why the minimum wage is bad news for small business and the overall economy, and
• alternative strategies to the minimum wage that help everyone, instead of just some workers at the expense of others.

��

The Success Sequence provides an outline of how to reverse the cycle of poverty in our communities. GCO uses this as a framework for much of our work.

Promoting Purchasing Power��

The declared it is the policy and responsibility of the federal government to:

�� �� �� �� ��“promote maximum employment, production, and purchasing power.”

Promoting purchasing power means lowering the cost of living, as Jazmine suggested.��

Solidified in the with the Treasury Department, the responsibility ultimately fell to the Federal Reserve to conduct monetary policy as we know it today.

How well has the Fed done with promoting purchasing power? Horribly, quite frankly.

Since 1951, prices have increased 3.4% annually on average, as measured by the geometric mean. In other words, the price level was tenfold higher in 2020 than in 1951. Prices doubled each generation.

It is widely accepted that the because they spend a higher portion of their income on necessities, and their income growth typically lags others.��

For example, according to the most recent from the Bureau of Labor Statistics, consumers in the lowest income quintile spend 82.2 percent of their income on housing, transportation, food, and healthcare, compared to 64.4 percent for the highest quintile. A five percent inflation rate would cost those in the lowest quintile an additional $1,156 for these items on a budget that is already tight, averaging $28,141. A 10% inflation rate would double those costs to $2,312.

Worse, those in the lowest quintile are unable to save for their future, and inflation erodes away the value of the little savings they do have. Consider that on average, those in the lowest quintile purchased only $563 in personal insurance or toward their pensions, compared to $19,736 for those in the highest quintile. This disparity guarantees the poor will be inadequately prepared for retirement or unforeseen loss or tragedy.

Prior to the federal government taking on the responsibility of promoting purchasing power, prices not only remained fairly stable but actually decreased during times of relative peace. Typically, they only increased dramatically during times of war.��

This pattern can be seen visually in the accompanying chart using the from the Federal Reserve Bank of Minneapolis. For example, the price level increased 24% due to the War of 1812 but then deflated 57% over 47 years until the start of the Civil War, even after accounting for a slight bump up due to the Mexican War.��

The pattern was similar for the remainder of the century. Prices increased 74% during the Civil War but then deflated 47% to its pre-Civil War level until the start of the 20th Century.*�� Although the price level rose somewhat during the progressive era, it was still 30% lower at the start of World War I than at the close of the Civil War.

America’s inflationary policy��

Unfortunately, a changed promoting purchasing power to become the lame “reasonable price stability,” which is not the same thing.

Over the years, the Fed has allowed inflation as a. In 2012, Fed Chairman Ben Bernanke explicitly stated for the first time an inflation target of 2% per year. If the Fed can somehow hold to this target, which it has not been able to do historically, it equates to doubling the price level every 35 years. Last August, it backed away from this policy. Because of all the pandemic spending and monetary expansions, the Fed approved a to allow inflation to rise “modestly” above its 2% target.��

It is not just the Fed that has shied away from promoting purchasing power. In 1978, and in the midst of the stagflation years, Congress the modest goal that inflation should be 3% or less, but the target rate was supposed to come down to zero percent by 1988 unless it might have impeded employment.����

The Fed is not alone to blame for the inability of the federal government to control inflation. Congress’s lack of fiscal discipline resulting in soaring budget deficits place the Fed in a tenuous position to keep interest rates low so federal debt service costs also remain low. Furthermore, recent Fed direct purchases of Treasury debt because of all that federal spending adds to the money supply, eroding—not promoting—purchasing power.

How Congress can better help the average working family

If economics has any immutable law, it must be that you can’t get something out of nothing. This explains why the Consumer Price Index increased 5.4% since last year, as by the Bureau of Labor Statistics. And the rate of increase appears to be accelerating. The monthly rate was 0.6% in May but 0.9% in June. If this June inflation rate persists, and hopefully it does not, we will have double digit inflation. A 0.9% monthly rate equates to an 11.4 % annual rate.����

Considering all the recent deficit spending by Congress and expansionary policies by the Fed, expect more of the same, or worse. In fact, according to a , “Americans should brace themselves” because economists are waking up to the prospect of higher inflation, expecting “brisk price increases for a while.”

Economic history indicates deflation should be the norm. In fact, innovation spawns increased productivity that allows prices to fall, which should show up as deflation. We have the opposite: productivity gains with inflation. This outcome places the blame squarely on monetary and fiscal policy.��

In the meantime, Jazmine and other hard working Americans struggle to keep up with rising prices. Instead of pushing for increases in the minimum wage that help some at the expense of others, Congress needs to renew our nation’s purchasing power policy and get its fiscal house in order.��

��*Jazmine’s last name withheld for confidentiality.

*This is not intuitive. It takes a smaller percent decrease to offset a percent increase, such as a 43% reduction will offset a 74% increase. For example, suppose you receive a 20 percent pay raise this week, but next week you receive a 20 percent pay cut. Are you back where you started? The answer is no; you are worse off. If your weekly pay was $100, the increase took you to $120, but then your pay cut took you to $96, even lower than your starting point.

Erik Randolph is the Director of Research at the Ģ����Ƶ Center for Opportunity.

The post Promote Purchasing Power—Not the Minimum Wage appeared first on For Opportunity.

Is there any reason not to cheer? Ģ����Ƶ’s unemployment rate dropped to 4.1 percent in May.��

Here are three reasons why this looks good for Ģ����Ƶ.��

First, the unemployment rate is declining, giving optimism that the economy is bouncing back from the pandemic.

Second, there were only two periods in recorded history when Ģ����Ƶ’s unemployment rate was this low or lower. Starting from 1976—the extent of available data from the U.S. Bureau of Labor Statistics (BLS) on unemployment rates for the states—the first period was between October 1998 and July 2001 when the rate reached as low as 3.4 percent. This period occurred after the long economic expansion of the 1990s.��

The other period—from April 2018 to the start of the pandemic—just occurred with Donald Trump in the White House. During this period, Ģ����Ƶ broke its best record by achieving 3.3 percent.

Third, Ģ����Ƶ’s rate is the 16th lowest in the country, beating out 34 other states. For comparison, the United States as a whole has a rate of 5.8 percent rate, considerably higher than Ģ����Ƶ’s.

But wait. Is the unemployment rate artificially low?

While optimism is merited, it is important to put the unemployment numbers in perspective.

Unemployment percentages do not capture those who do not participate in the labor force. According to the BLS, anyone not employed who had not actively looked for a job during the prior four weeks is not part of the labor force. Therefore, any person temporarily not looking for work is not accounted for when the BLS calculates the official unemployment rate. Especially now with all the repercussions of the pandemic, all those potential workers who have been sitting on the sidelines for the last four weeks are simply not counted.

The behavior of labor force participation is a loose link for unemployment numbers. Normally, when economic times are good, sidelined workers and even retirees come back into the labor force, which can push the unemployment rate up. When times are bad, the opposite happens. Workers drop out of the labor force, artificially lowering the unemployment rate.

During the depth of the pandemic, and as expected, the labor force participation rate in Ģ����Ƶ dropped—to 59.4 percent to be precise, compared to 62.9 percent just prior to the pandemic. In terms of real people, there were an estimated 260,575 fewer workers participating in the labor force—who were not counted among the unemployed, to emphasize the point. Participation bounced back some to 61.7 percent, but still there are 40,934 fewer workers in the labor force.

Other ways to measure it

BLS’s U-6 labor underutilization metric is another way to shed light on unemployment. It adds to the unemployed those discouraged and other “marginally attached” workers as well as part-time workers wanting full-time work but cannot find it.��

Nationally, the U-6 rate hit a historic high of 22.9 percent in April 2020 representing 36.3 million people. It has since dropped to 10.2 percent representing 16.5 million people. However, in the months prior to the pandemic, the rate was at historic lows—in fact, as low as 6.8 percent. Obviously, while 10.2 percent is far better than 22.9 percent, it is significantly worse than 6.8 percent, representing a difference of 5.3 million workers.

Unfortunately, monthly U-6 data is not available for the states, making any comparison difficult. The BLS currently publishes only experimental U-6 state data averaged over a year’s time.

More useful for the states is the Nonfarm Employment estimates from BLS’s Current Employment Statistics survey. Only two states—Utah & Idaho—have caught up with employment from where they were in February 2020 before the pandemic hit. In contrast, the U.S as a whole is still 5% behind. Ģ����Ƶ ranks 16th among the states and is 4.0 % behind. Hawaii (-14.8%), New York (-9.6%), and Nevada (-8.6%) are the three states furthest behind.��

If we use standard economic ARIMA Model time-series forecasting to estimate where employment would have been absent the pandemic, no state is back on track. The United States is 6.8% behind, and Ģ����Ƶ ranks near the middle in 27th place at −6.1%. Utah and Idaho lead the pack being the furthest ahead, while Hawaii, Nevada, New York, California, and Massachusetts trail the pack.

Observations on state differences and policies

In viewing the differences in employment among the states, the more rural states appear to be doing better. The states more dependent on tourism appear to be doing worse. State governments that implemented less severe lockdowns appear to be doing better. To test these observations, we will be running regression analyses to tease out any correlations. We will post the results when completed.

In the meantime, it is important for government to adopt policies that will help businesses to rebound and make it easier for startups. The goal should be not to just lower unemployment but also to bring those sidelined workers back into the labor force.

Erik Randolph is the Director of Research at the Ģ����Ƶ Center for Opportunity.

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GUARANTEED POVERTY

We need to have a frank discussion about how we view our fellow man and what we want for ourselves, our families, and our neighbors.

At the forefront of this discussion are policies that seem to want to help people. Policies that are labeled “anti-poverty” or expand social services indeed have good intent. However, I suggest these policies often are pandering and dismissive of the value of the person we hope to help.��

For instance,. On its face, this sounds like a way to help those in need find help. But as we dive deeper we begin to see that we are subsidizing rather than alleviating poverty. It reeks of the idea that we would simply pay off the poor and want nothing substantive for them.

INTERGENERATIONAL POVERTY STUDY

Understanding how poverty is perceived by those in it, so that we can better understand how to address it.

VIEW OUR FINDINGS

HOW DO WE VIEW THOSE IN NEED?

We must realize that these actions cause us to look at our neighbor as a purely numerical transaction— a phrase often used to push against the ideas of capitalism, but one resoundingly relevant when we discuss these guaranteed incomes. The idea is that a person who is homeless or without work deserves to only be given a small living wage to simply survive.��

And survive on what? The quality of housing affordable on such services is usually in dangerous areas or ill-suited for long-term living. The quality of food affordable often leads to obesity or unhealthy lifestyles. Yes, they survive but we have afforded them no dignity or purpose in life.

The bottom line is the utter lack of compassion or humanity in this response. The idea that we view fellow humans as so incomplete that we ask nothing of them. This mentality simply says, “You can give us nothing so we will expect nothing of you.”

As a society, we have sold this idea as moral or righteous, but we sell short the potential of the people we hope to serve. We have robbed them of being fulfilled and feeling successful.

I am in no way saying that people hold no value unless they have a job. But what I am saying is that everyone has something to contribute and a way to bring value to those around them. More importantly, we desire to contribute and find self-worth in doing so.

DEFINING HUMAN FLOURISHING

We at the Ģ����Ƶ Center for Opportunity refer to this as “human flourishing.” We seek to help ensure that everyone has access to it, no matter the circumstances of their birth. In doing so, we understand that flourishing will look different for each person. That is a beautiful thing.

Recently a famous YouTuber, Mark Rober, . Mark’s son will likely never hold a job or be able to do the same things 99% of people will but he still desires to contribute and bring value to those around him. So yes we will need to adapt our understanding of success and human flourishing, but I would challenge us to consider that merely existing is not flourishing. And expecting that you will not flourish shows a severe lack of compassion and empathy.

Compassion requires that we would want more for people. Not merely enough material possession to be appeased but to truly desire for human flourishing.

On the opposite end of flourishing is merely surviving with no hope or want for more. Hopelessness occurs when we expect nothing from someone.

This is why we must look at policies that do more than simply address a felt need. We must build systems that restore and promote dignity and purpose. They must not trivialize human value to a monetary transaction. Instead, they must instill hope, purpose, and an expectation of human flourishing.

BE PART OF BRINGING OPPORTUNITY TO OTHERS!

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The post Guaranteed Income Subsidizes Poverty And Trivializes Those In Need appeared first on For Opportunity.

Part 1

By Erik Randolph

The monthly spending for food stamp benefits in Ģ����Ƶ nearly doubled since before the start of the pandemic. Surprisingly, only 45.3 percent of the increased spending is due to increased participation. The remaining 54.7 percent is due to enhanced benefits.

Congress Makes a New Food Stamp Rule

On March 18th, the U.S. Senate passed that the U.S. House of Representative passed just four days prior. President Donald J. Trump signed the bill that same day, making the Families First Coronavirus Response Act (P.L. 116-127) the second federal law to address the looming pandemic.��

The food stamp provisions in the law suspended work and work-training requirements and allowed states to request waivers to give recipients the maximum allotment for the Supplemental Nutrition Assistance Program (SNAP), the official name of the food stamp program.��

Along with all other states, Ģ����Ƶ requested and received a pandemic-SNAP waiver—P-SNAP for short. P-SNAP lasts as long as there is a declared health emergency by the Secretary of Health and Human Services, and the waivers are renewed on a monthly basis.

Here is what it means in practice: Currently, all households of the same size receive the exact same food stamp allotment. An eligible single mom with one child receives $374 a month in food stamp benefits, the same amount as every other eligible two-person household in Ģ����Ƶ, no matter what income the household earns. It does not matter if the single mom has no income or makes $22,400 annually, which is just below the gross income limit. She still receives $374 each month in benefits.��

Likewise, an eligible four-person household currently receives $680 each month no matter if the household has no income or $34,000 in income, which is also just below the gross income limit.

During normal times, DFCS calculates net income of the household by subtracting several deductions and allowances from a household’s gross income. Then, to determine the amount of the benefit, DFCS subtracts 30 percent of the calculated net income from the maximum allotment.��

Benefits and Costs��

The number of Ģ����Ƶ households participating in the food stamp program was 626,808 in February 2020. As of September, that total was 905,949 households—a 44.5 percent increase. The number of persons participating increased from 1,342,624 to 1,862,486 for a 38.7 percent increase.��

The regular issuance of food stamp benefits followed the increase in household participation. It increased from $163,247,601 to $236,170,166—a 44.7 percent increase. Although the average fluctuated as much as $10.58 on a month-to-month basis, the average household benefit was $260.44 in February compared to $260.69 in September, which are almost identical.��

However, P-SNAP enhanced the size of the payments to the participants. When combined with the regular issuance, the total benefits in September were $324,169,118 for a 98.6 percent increase, increasing the average household benefit to $357.82. Note that these numbers do not include $100,385,379 for free and reduced price school lunches in September that were funneled through the Electronic Benefit Transfer cards that are used to issue the food stamp benefits.��

Was this the Best Way to Do it?

Note that Congress did not allow the states to expand the number of participants beyond the normal eligibility criteria for the program. The P-SNAP benefits of $581,085,040 spent since March were spent on those who would have normally qualified for the benefits.

Consequently, the households who benefited the most from the extra funding were those households with the higher incomes just under the eligibility limits. My next blog will show in greater detail how P-SNAP caused the welfare cliff to jump in magnitude.

In the meantime, if you have an opinion on whether this was a fair way to allocate extra funding for food stamps, be sure to let us know in the comments below.

Check Out Part 2

Erik Randolph is Director of Research at the Ģ����Ƶ Center for Opportunity. This blog reflects his opinion and not necessarily that of the Ģ����Ƶ Center for Opportunity.

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By Shana Burres

Cody and Estelle are a young married couple living in a suburban neighborhood. Cody has a full-time job and Estelle is a nanny so she can have their daughter with her at work. They make just enough money to pay the rent on their small home and pay their bills, but there is rarely anything left over each month. They are not middle class but they are above the poverty line, and they are facing a potential financial crisis because of health care costs.  

Cody’s work offers an insurance plan but does not subsidize the cost and the monthly premium for a family is more than their rent. Because of the expansion of Medicaid under the Affordable Care Act (ACA), they qualify for a government-subsidized plan. The coverage is poor and the deductibles are high. They are one emergency room trip or unexpected surgery away from a dire financial situation.

Cody is working on building a part-time freelance business so they can have some savings and buy a more reliable car. But he is hesitant to promote it because too much of an increase in income will push them over the ACA’s income threshold and they will lose their health care subsidy. They still wouldn’t be able to afford the employer-sponsored plan and would lose coverage entirely. 

They are facing the, forced to choose between self-improvement and maintaining necessary services. If they increase their income, they are at risk of falling into the welfare gap—too much income for services, not enough income to cover the costs.

The implications of the loss of health care coverage reach into their and their daughter’s future. Health insurance, and the associated continuity of care, in the short term and life success in the long term.  At a  basic level, health care means that students are better able to engage in their academics and miss fewer days of school.

In slightly more complex terms, lacking health insurance, along with other factors related to instability, is part of the . These social determinants are a cluster of lived experiences that include food instability, homelessness, and poverty. They are direct predictors of poor health and, as noted, poor health contributes to poorer academic and social outcomes. While programs or funding can often address homelessness and poverty, a family has available to purchase food. For a family like Cody and Estella’s, this may be seen as the choice between groceries and paying for an urgent care visit and a prescription for their daughter. 

For them and the vast majority of people in the United State, health insurance is the barrier to care. People who live at or below the poverty line have access to medical coverage through Medicaid. And families who live far above the poverty line can access health insurance through work or afford to pay for the premiums through the health exchange. However, the evidence shows that children who are near, but not under, the poverty line have the . These children and their families live in the welfare gap, a reality for . This means that Ģ����Ƶ’s families need solutions for ongoing health care to support their long-term success.

The most effective solutions are those that acknowledge the immediate needs of families and address the need for policy change. Currently, many programs are aimed at the individual or involve community-based interventions that . And these programs can be useful and effective as solutions to the immediate needs of families living in the welfare gap. Unfortunately, these do not address the upstream institutional, systemic, and public policy drivers of the distribution disparities. 

Ģ����Ƶ’s families deserve upstream solutions that address the welfare gap and support their efforts to be participants in their health care and long-term outcomes. Three interconnected approaches offer equitable and proven access:

Untether healthcare from employers

According to the US Census Bureau, approximately 55% of people have access to. This tethering of health insurance to employment leads to disruptions of coverage due to job loss or change. Therefore, untethering healthcare from its connection to employment would allow people to pursue jobs, education, or entrepreneurship free from the limitation of health insurance access or cost.��

Make shopping for health insurance easier

As cost is the most significant factor influencing people’s access to health insurance, the second approach is to make shopping for health insurance the same as shopping for any other type of insurance. Individuals could compare coverage, cost, and other options across multiple providers, which would empower them to choose the product best suited to their particular needs. Currently, most people have little to no choice in which insurance product they receive from their employer and the cost is more closely related to the company’s ability to negotiate a favorable contract than it is to the types of benefits the employees need.��

Offer government subsidies that do not create welfare cliffs

Of course, employers often also subsidize a portion of their company health insurance plan, and subsidies are one of the ways insurance is made more affordable for their employees.  The third approach, government subsidies, would ensure these benefits are equitable and accessible to the whole population and not reliant on an employer. While government-funded health insurance already exists and subsidies are available through the ACA marketplace, the current method does not address  welfare cliffs or close the welfare gap. Therefore, the policy should be updated to a means-tested  eligibility system that eliminates marriage penalties and the breakpoints that contribute to the welfare cliff. 

For our couple, Cody and Estelle, this new approach to health insurance would allow them to gain sufficient coverage for their whole family without spending a disproportionate amount of their income on health care costs. It would allow Cody to build his freelance business and improve their quality of life without fear of losing health insurance while their income grows. 

Every person in Ģ����Ƶ deserves to live a healthy and fulfilling life. Access to healthcare is a necessary component of their success. These three approaches will remove barriers to access, equalize costs, and ensure support is available to those who need it. 

Shana Burres is an educator, foster parent, and speaker. She holds a Master’s degree in education and, as the former executive director of DASH Kids, is a fierce advocate for equitable outcomes for children of all backgrounds and experiences. Shana currently is an adjunct professor, learning development consultant, and her local Mockingbird HUB home for foster families and their youth.

DISINCENTIVES FOR WORK AND MARRIAGE IN GEORGIA’S WELFARE SYSTEM

Based on the most recent 2015 data, this report provides an in-depth look at the welfare cliffs across the state of Ģ����Ƶ. A computer model was created to demonstrate how welfare programs, alone or in combination with other programs, create multiple welfare cliffs for recipients that punish work. In addition to covering a dozen programs – more than any previous model – the tool used to produce the following report allows users to see how the welfare cliff affects individuals and families with very specific characteristics, including the age and sex of the parent, number of children, age of children, income, and other variables. Welfare reform conversations often lack a complete understanding of just how means-tested programs actually inflict harm on some of the neediest within our state’s communities.

DOWNLOAD WHITE PAPER

DOWNLOAD EXECUTIVE SUMMARY

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��

By David Bass

The Ģ����Ƶ Center for Opportunity (GCO) today released the results of a parent opinion poll that found 81 percent of respondents in favor of using federal emergency relief funds to help parents cover some educational costs during the coronavirus pandemic.

The poll, taken of a random sample of 721 Ģ����Ƶ parents, also found that such microgrants would encourage parents to make alternative educational decisions for their children: 59 percent of respondents reported that a one-time microgrant of $1,000 would either prompt them to send their child to a different school or help out in their existing decision to do so.

Recently, a coalition of education reformers sent a letter to Gov. Brian Kemp urging him to use the remaining portion of the Governor’s Emergency Education Relief (GEER) Fund to directly support students through the challenges of virtual learning. Currently in Ģ����Ƶ, the governor’s office is the only entity in the state with the ability to provide families with this desperately needed help.

The poll results back up what we already know: Offering direct payment assistance to Ģ����Ƶ families is the best way to keep vulnerable students from falling further behind during this crisis. A one-size-fits-all approach to education never works. We must offer as many families as possible maximum flexibility in their education decisions this year. Empowering parents directly with funds puts them in the driver’s seat and cuts out bureaucratic obstacles. This step simply takes available additional federal funds and gives parents the most help, the fastest, right when they need it the most.

A Survey Of How The Average Ģ����Ƶ Family Is Navigating Education During The Pandemic

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. Hannah has been isolated at home since March and is falling behind. “Putting education dollars directly into the hands of parents means that our children have a greater chance of not falling behind,” wrote Hannah’s mother, Elizabeth, in the Atlanta Journal-Constitution. “The funds will come nowhere close to meeting the needs of students like my daughter, but they will help to bridge the gap until schools can fully reopen again.

Other key findings from the poll include:

• 57 percent said their children learned “far less” or “somewhat less” than they had when they were in their pre-shutdown school.
• Only 12 percent of respondents said their school did “badly” or “very badly” during the coronavirus crisis. Thirty-three percent were neutral and 55 percent said their school did “well” or “very well.”
• Only 18 percent of respondents thought that their schools did not provide enough resources to their children.
• 33 percent thought that there was “much work” or “far more work than I imagined it would be” to teach their children because of the shutdown.
• Only 6 percent are considering homeschooling their children when last year they were not home schooled.

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