Economists have documented the disproportionate, negative effect of work requirements on homeless recipients.
As the negotiations to extend the federal debt ceiling neared the early June deadline, a notable change concerning SNAP benefits, commonly known as food stamps, was inserted into the final measure. Work requirements, which have been part of the program since the 1990s, would be imposed on a larger swath of beneficiaries, just as the House-passed bill had mandated. But in the final version of the Fiscal Responsibility Act of 2023, signed into law on June 3, homeless recipients would be exempt.
That was good news to Elena Prager, an assistant professor of economics at the University of Rochester’s Simon Business School. Prager was part of a team that also included economists from MIT, Harvard, the University of California, Berkeley, and the University of Maryland whose research had shown that SNAP work requirements had a disproportionate, adverse effect on homeless recipients.
Their study was published this year in American Economic Journal: Economic Policy. The group reported that SNAP work requirements have had “no effects on employment.” Instead, the team showed that the requirements have led to a reduction in beneficiaries, chiefly among homeless recipients with limited to no employment history.
“I don’t know for sure whether our paper caused [the exemption],” Prager says, “but as far as I know, we were the first research team to document that work requirements disproportionately impact homeless people. And it’s pretty plausible that people working in Congress who have been reading our work and reaching out to us made that happen.”
Food stamp work requirements: Not working
The federal Supplemental Nutrition Assistance Program dates back to the Great Depression. Then called the Food Stamp Program, it has become one of the largest antipoverty programs in the United States, distributing, the researchers note, nearly $70 billion to more than 45 million people, or 14 percent of the nation’s population, as of 2015. The program provides subsidies that recipients can use exclusively for food.
The program instituted work requirements for most nondisabled recipients in 1996, with passage of the Personal Responsibility and Work Opportunity Reconciliation Act. The rationale for work requirements, as articulated in the bill, was that they would help unemployed recipients make a transition into the paid labor force. Once in the paid labor force, recipients would gain skills, leading to a full-time living wage—and an end to SNAP dependency.
The assumption behind the policy, says Prager, “is that without the requirements, SNAP will discourage people from working because their food needs are already partially taken care of, or because making too much money would mean losing their SNAP eligibility.” In that case, instituting work requirements would increase employment. But the research shows instead “that for SNAP recipients who do not have a job, the barriers to working are something other than a lack of work requirements.”
Research findings rooted in Virginia’s Great Recession response
Because work requirements have been the norm in SNAP for almost three decades now, it was a challenge to design a study that would show what a world without SNAP work requirements would look like. But the Great Recession provided an opportunity.
The federal response to the recession, the American Recovery and Reinvestment Act, included a waiver of SNAP work requirements, which remained in force until November 2013. Using Virginia as a case study, Prager and her coauthors accessed administrative data from the Virginia Department of Social Services spanning 2007 to 2015. For each SNAP recipient, they collected demographic information, disability and employment status, housing type, earned and unearned income, and the first and last calendar months of SNAP participation periods. The researchers found that the reintroduction of work requirements caused a quarter of recipients subject to them to lose their SNAP benefits. The loss of benefits was especially acute among those who “prior to the reinstatement of work requirements, are homeless or have no earned income.”
Shifting costs
Prager notes that there are documented health effects from the loss of SNAP benefits. But she says there are additional, unanswered questions. For example, does the loss of benefits, which would place added strain on a recipient’s budget, have any impact on evictions? “We know that homeless recipients are disproportionately affected by work requirements,” she says. “We don’t know whether work requirements actually cause more homelessness.”
There’s also the question of whether the policy simply shifts costs.
“You spend less money on SNAP benefits because people leave the program, but you probably create social costs elsewhere,” Prager says.
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