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http://ssrn.com/abstract=2409544
 
 

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Scraping by: Income and Program Participation after the Loss of Extended Unemployment Benefits


Jesse Rothstein


University of California, Berkeley, The Richard & Rhoda Goldman School of Public Policy; University of California, Berkeley, College of Letters & Science, Department of Economics; National Bureau of Economic Research (NBER)

Robert G. Valletta


Federal Reserve Bank of San Francisco; Institute for the Study of Labor (IZA)


IZA Discussion Paper No. 8022

Abstract:     
Despite unprecedented extensions of available unemployment insurance (UI) benefits during the "Great Recession" of 2007-09 and its aftermath, large numbers of recipients exhausted their maximum available UI benefits prior to finding new jobs. Using SIPP panel data and an event-study regression framework, we examine the household income patterns of individuals whose jobless spells outlast their UI benefits, comparing the periods following the 2001 and 2007-09 recessions. Job loss reduces household income roughly by half on average, and for UI recipients benefits replace just under half of this loss. Accordingly, when benefits end the household loses UI income equal to roughly one-quarter of total pre-separation household income (and about one-third of pre-exhaustion household income). Only a small portion of this loss is offset by increased income from food stamps and other safety net programs. The share of families with income below the poverty line nearly doubles. These patterns were generally similar following the 2001 and 2007-09 recessions and do not vary dramatically by household age or income prior to job loss.

Number of Pages in PDF File: 53

Keywords: unemployment benefit exhaustion, household income, social program interactions

JEL Classification: J65, I38

working papers series





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Date posted: March 15, 2014  

Suggested Citation

Rothstein, Jesse and Valletta, Robert G., Scraping by: Income and Program Participation after the Loss of Extended Unemployment Benefits. IZA Discussion Paper No. 8022. Available at SSRN: http://ssrn.com/abstract=2409544

Contact Information

Jesse Rothstein (Contact Author)
University of California, Berkeley, The Richard & Rhoda Goldman School of Public Policy ( email )
2607 Hearst Avenue
Berkeley, CA 94720-7320
United States
HOME PAGE: http://gsppi.berkeley.edu/faculty/jrothstein
University of California, Berkeley, College of Letters & Science, Department of Economics ( email )
549 Evans Hall #3880
Berkeley, CA 94720-3880
United States
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Robert G. Valletta
Federal Reserve Bank of San Francisco ( email )
101 Market Street
San Francisco, CA 94105
United States
415-974-3345 (Phone)
415-977-4084 (Fax)
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
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