Work Requirements Are (Socially) Toxic Sludge

Work requirements for anti-poverty programs don’t encourage work, as their proponents claim. Instead, the evidence indicates, these misguided policies make it harder for people to maintain or find employment. Their principal effect is stripping people of the benefits they rely on to survive.

Since work requirements were imposed in 1997, they have stripped direct financial support in the form of Temporary Assistance for Needy Families (TANF) from almost 2 million families.  

This litany of lost benefits is bound to grow, because of the Trump Administration’s executive order calling on federal agencies to enforce existing work requirements on public assistance programs, review all waivers and exemptions to such mandates, and add new work requirements to government aid programs that lack them. Arkansas was an early adopter, imposing work requirements on Medicaid in June 2018, and more than 18,000 individuals have since lost their health insurance. Since then, new or stricter work requirements have been proposed or promulgated across programs like Medicaid, the Supplemental Nutrition Assistance Program (SNAP), and housing assistance programs. If these new rules stand, we’ll see many people losing benefits they need.

These new hurdles are often deliberate efforts to make it impossible to access effective anti-poverty programs.

Contrary to some ideologues’ arguments, falling participation doesn’t indicate a decrease in need or desire for these programs; instead, it’s a side-effect of sludge—decision-making obstacles that make it less likely for people to end up better off. Introducing these obstacles can deter anyone from completing intended actions, so the pattern of benefits loss is troubling but not particularly surprising.

Stricter compliance standards demand more of people’s cognitive bandwidth. Our memory and brain power are finite resources, and it’s difficult for everybody to attend to all of life’s small details, recall information, and remember to take actions. And people living without much financial slack have even more demands on their bandwidth, making these new demands more cognitively costly, and thus less likely to be met. Overall, work requirements violate each of the three principles we at ideas42 have identified as essential to addressing poverty: cutting costs, creating slack, and reframing programs and empowering participants.

The major new cost imposed by work requirements is, in addition to meeting all the current eligibility requirements (which are already quite onerous), individuals must now also prove their work status. This could mean documenting that they’ve worked sufficient hours or have engaged in a short list of other acceptable activities, or proving they are exempt from working. These new hurdles are often deliberate efforts to make it impossible to access effective anti-poverty programs. Many people find themselves deterred by hassles, end up not reporting their work-related activities, and fall out of compliance, ultimately losing their benefits.

Attaching work requirements to benefits programs disempowers people by fueling harmful false narratives about poverty.

In addition, most people and families receiving public benefits are already working or have worked recently, so the requirements, rather than encouraging people to work, merely add demands on people’s time and attention. This slashes slack in clients’ lives. For example, the Access Arkansas website where clients must report their hours and earnings in order to keep their Medicaid benefits actually closes between 9 p.m. and 7 a.m.—making it nearly impossible for anybody who works during the day to use. And people receiving public benefits often have irregular work schedules or have no control over how many hours they are scheduled each week. Despite this real-world volatility, work requirements are generally rigid and make it difficult for families living in chronic scarcity to comply even when they are working.

Finally, attaching work requirements to benefits programs disempowers people by fueling harmful false narratives about poverty. Specifically, these policies are built on the assumption that people need to be forced to work, and that stems from a widespread false moral narrative that casts people who use public programs as deficient and in need of policing. Think about it: most people would never consider imposing work requirements and their associated monthly reporting on a federal tax expenditure like the Mortgage Interest Tax Deduction (about $77 billion per year), but many readily accept them for SNAP (about $68 billion per year). These are both federal benefits, but only one comes burdened with the baggage of an untrue moral narrative about its beneficiaries being undeserving of help.

The title of a new paper on this topic by my team at ideas42 says it all: “Work Requirements Don’t Work.” They don’t help people maintain or find employment; they only increase hassles and cause people to lose much-needed benefits. If we want to provide economic security and health insurance programs in a behaviorally informed way, work requirements are not the answer. With the people who need benefits the most being the ones most likely to have them taken away, we can truly call this work requirements regime socially toxic sludge.

Disclosure: The author is an employee of ideas42, a founding partner of the Behavioral Scientist.