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COVID‐19 and the US Safety Net

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  • Robert A. Moffitt
  • James P. Ziliak

Abstract

We examine trends in employment, earnings and incomes over the last two decades in the United States, and how the safety net has responded to changing fortunes, including the shutdown of the economy in response to the COVID‐19 pandemic. The US safety net is a patchwork of different programmes providing in‐kind as well as cash benefits, and it had many holes prior to the pandemic. In addition, few of the programmes are designed explicitly as automatic stabilisers. We show that the safety net response to employment losses in the COVID‐19 pandemic largely consists only of increased support from unemployment insurance and food assistance programmes, an inadequate response compared with the magnitude of the downturn. We discuss options to reform social assistance in the United States to provide more robust income floors in times of economic downturns.

Suggested Citation

  • Robert A. Moffitt & James P. Ziliak, 2020. "COVID‐19 and the US Safety Net," Fiscal Studies, John Wiley & Sons, vol. 41(3), pages 515-548, September.
    • Handle: RePEc:wly:fistud:v:41:y:2020:i:3:p:515-548
    DOI: 10.1111/1475-5890.12243
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    Cited by:

    1. Guido Matias Cortes & Eliza Forsythe, 2023. "Distributional impacts of the Covid-19 pandemic and the CARES Act," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 21(2), pages 325-349, June.
    2. Rees-Jones, Alex & D’Attoma, John & Piolatto, Amedeo & Salvadori, Luca, 2022. "Experience of the COVID-19 pandemic and support for safety-net expansion," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 1090-1104.
    3. Larrimore, Jeff & Mortenson, Jacob & Splinter, David, 2023. "Earnings business cycles: The Covid recession, recovery, and policy response," Journal of Public Economics, Elsevier, vol. 225(C).
    4. Ahmad Zia Wahdat, 2022. "Economic Impact Payments and Household Food Insufficiency during COVID-19: The Case of Late Recipients," Economics of Disasters and Climate Change, Springer, vol. 6(3), pages 451-469, November.
    5. Patrick Meehan & Trina Shanks, 2024. "Poverty Reduction is Not the Whole Story: The COVID-19 Pandemic Response in Relation to Material Hardship," Journal of Family and Economic Issues, Springer, vol. 45(2), pages 458-469, June.
    6. Larrimore, Jeff & Mortenson, Jacob & Splinter, David, 2022. "Earnings shocks and stabilization during COVID-19," Journal of Public Economics, Elsevier, vol. 206(C).
    7. Korenman, Sanders & Hyson, Rosemary T., 2023. "Health insurance, labor market shocks, and mental health during the first year of the COVID-19 crisis," Economics & Human Biology, Elsevier, vol. 51(C).
    8. Michihito Ando & Masato Furuichi, 2022. "The association of COVID-19 employment shocks with suicide and safety net use: An early-stage investigation," PLOS ONE, Public Library of Science, vol. 17(3), pages 1-26, March.
    9. Anna L. Steeves-Reece & Christina Nicolaidis & Dawn M. Richardson & Melissa Frangie & Katherin Gomez-Arboleda & Chrystal Barnes & Minnie Kang & Bruce Goldberg & Stephan R. Lindner & Melinda M. Davis, 2022. "“It Made Me Feel like Things Are Starting to Change in Society:” A Qualitative Study to Foster Positive Patient Experiences during Phone-Based Social Needs Interventions," IJERPH, MDPI, vol. 19(19), pages 1-17, October.

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    More about this item

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)

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