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Benefits Cliffs as a Barrier to Career Advancement for Low-Income Adults: Insights from Employment Services Providers

Author

Listed:
  • Alexander Ruder
  • Julie Siwicki
  • Ellyn Terry
  • Tamilore Toyin-Adelaja

Abstract

How do employment service providers explain benefits cliffs to clients who want to advance in their careers? To answer this question, the authors conducted three focus groups with a range of employment service providers. Focus group participants report that counselors and clients struggle to manage benefits loss because of a lack of clarity on program rules and difficulty finding appropriate jobs that pay enough to outweigh the loss of benefits. When advising clients about career advancement, counselors use a range of intake processes to determine clients’ immediate needs and assess their skills and occupational interests. Career counseling activities typically focus on short-term goals and immediate needs rather than longer-term career planning, though participants acknowledge the value of labor market information that shows the long-term gains of advancing up career pathways. The authors conclude with several recommendations to help counselors manage complex benefits eligibility rules, the short-term needs of clients who face barriers to employment, and labor market information to guide training and employment decisions.

Suggested Citation

  • Alexander Ruder & Julie Siwicki & Ellyn Terry & Tamilore Toyin-Adelaja, 2020. "Benefits Cliffs as a Barrier to Career Advancement for Low-Income Adults: Insights from Employment Services Providers," FRB Atlanta Community and Economic Development Discussion Paper 2020-2, Federal Reserve Bank of Atlanta.
    • Handle: RePEc:fip:fedacd:87806
    DOI: 10.29338/dp2020-02
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    References listed on IDEAS

    as
    1. Congressional Budget Office, 2015. "Effective Marginal Tax Rates for Low- and Moderate-Income Workers in 2016," Reports 50923, Congressional Budget Office.
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    4. Congressional Budget Office, 2015. "Effective Marginal Tax Rates for Low- and Moderate-Income Workers in 2016," Reports 50923, Congressional Budget Office.
    5. Congressional Budget Office, 2015. "Effective Marginal Tax Rates for Low- and Moderate-Income Workers in 2016," Reports 50923, Congressional Budget Office.
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    7. Congressional Budget Office, 2015. "Effective Marginal Tax Rates for Low- and Moderate-Income Workers in 2016," Reports 50923, Congressional Budget Office.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    occupational mobility; vocational education; underemployment; career change; social mobility; unskilled; promotion; human capital;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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