President Joe Biden has touted the fact that the U.S. unemployment rate now stands at a half-century low of 3.4%. Despite the historically tight labor market, his administration’s actions have nullified work requirements for millions of food stamp recipients and boosted their incentive to remain on the sidelines.
As Congress seeks to rein in federal spending during debt ceiling negotiations, restoring work requirements in the Supplemental Nutrition Assistance Program should be at the top of the list.
Federal law requires that nondisabled recipients between the ages of 18 and 49 — who do not have children — must work or volunteer at least 80 hours per month in order to maintain SNAP benefits. At the onset of the COVID-19 pandemic, Congress justifiably suspended these work requirements as economic activity was shut down and unemployment soared to 14.7%.
But because almost three years later the Biden administration has failed to end the public health emergency — keeping it in place until May 11 — work requirements are still not being enforced at a time when workers are needed more than ever.
However, ending the public health emergency will not fully solve the problem. That’s because 18 states and territories containing 44% of the food stamp caseload have waivers in place that would prevent work requirements from taking effect even if the public health emergency ended today. These waivers are intended to protect beneficiaries when jobs are hard to find in a particular area, but their implementation suffers from major loopholes.
States qualify for waivers if their unemployment rates are just modestly higher than the national average — which has now reached a 54-year low — and they are calculated using out-of-date employment data. As a result, states with very low unemployment rates are currently covered by waivers, such as New Jersey (3.4%), Pennsylvania (3.9%), California (4.1%) and New York (4.3%). Among all states with work requirement waivers, Nevada is the only one with an unemployment rate above 5%.
The fact that work requirements are not being enforced when the national unemployment rate is the lowest in over a half a century defies economic logic. Economists frequently highlight the importance of tying the generosity of government assistance programs to the state of the economy. But that doesn’t just mean expanding generosity when jobs are hard to find. It also means restricting generosity when jobs are easier to come by.
There are two additional problems with suspending work requirements that makes restoring them especially urgent now.
The first problem is the cost of not enforcing work requirements. In 2021, the Biden administration — for the first time in 45 years — increased the real value of food stamp benefits by executive fiat, increasing the cost of the food stamp program by $20 billion per year. To make matters worse, the Government Accountability Office found that the administration’s analysis supporting the increase was rushed, lacked transparency and failed to meet the usual standards for external review.
Working-age adults without disabilities or children drew $5.6 billion annually in food stamp benefits prior to the pandemic. Their contribution to total food stamp spending today is likely much higher, since food stamp caseloads have risen and benefit amounts are higher. Reinstating work requirements would reduce program costs as more of these recipients would go to work and thereby reduce their benefit amount, or drop off the program altogether. These savings would contribute to efforts to reduce the budget at a time of intense negotiation over the need to raise the debt limit.
The second problem with suspended work requirements is its interference with the Fed’s goal of stemming inflation without spurring a painful recession. The unrelenting worker shortage puts pressure on the Fed to continue raising interest rates to cool the economy. Failing to require work of SNAP recipients, especially after Biden’s benefit increase, is making the Fed’s job harder by paying people to stay on the sidelines. That harms the overall economy as well as the individuals who remain disconnected from the benefits of work.
Efforts to restore work requirements to all states should start by immediately ending the public health emergency that suspended work requirements nationwide. Congress should then fix the loopholes for states that request waivers on account of local economic conditions. For example, Congress could require a state unemployment rate to reach at least 6% before it can potentially qualify for a waiver. This would closely follow the conditions necessary to trigger extended unemployment insurance benefits during periods of high unemployment, as well as a Trump-era reform to the food stamp program that was ultimately upended by the pandemic.
There has never been a better time to apply food stamp work requirements to working age adults without disabilities or children. The program’s cost has already been unilaterally inflated by the Biden administration, and the lack of work requirements is making the Fed’s job of reducing inflation harder. In the search for ways to cut federal spending and alleviate inflation, restoring food stamp work requirements in all states is a no-brainer.