279P
Public Benefits, Private Charity, and Informal Monetary Support in the Wake of the Great Recession
Little research has explored how low-income families drew upon different public and private elements of the safety net and social support networks to cope with the Great Recession. We focus on several key questions in particular: To what extent are low-income households receiving different public assistance programs and help from formal charity and informal sources of support? Which factors appear associated with public program participation, receipt of private charity, and use of informal monetary support?
Methods:
We use data from the Michigan Recession and Recovery Study (MRRS) to examine benefit receipt from public programs, private charity, and informal monetary support among a representative sample of 847 households in the Detroit metropolitan Area.
We examine receipt of seven different public safety net programs in the 12 months prior to the survey interview. In addition, we examine receipt of assistance from a nonprofit charity and informal monetary support from family or friends.
We focus on key household characteristics including educational attainment, employment, work-limiting health condition, financial hardship, food insecurity, children in the household, marital status, gender, religious attendance, and whether the respondent lent money to help a family member or friend. Because eligibility for many programs is means- tested, we focus our analyses on households who reported annual income at or below 200% of the poverty line.
Variables to adjust for the complex sample design were included in all descriptive and regression analyses reported in this paper. Analyses of receipt of charity and informal monetary support utilize logistic regression. The analysis of public program use utilizes Poisson regression.
Results: Those experiencing deeper poverty (<100% FPL) report significantly higher use of public programs and nonprofit charity, although their use of informal monetary support is similar to that of those in the 100-200% FPL group. Interestingly, the use of informal monetary support does not appear to be related to the use of public programs or charity, but those unemployed for 1-6 months of the past year show a significantly higher percent of informal monetary support use than those in other unemployment categories (56.7% vs 41.1%, 39.7%, 23.9%, and 38.9%). Those who report experiencing financial hardship and food insecurity report higher use of all types of supports versus those who do not report such hardships.
Factors significantly associated (p<0.05) with public program participation include race, children in household, gender, age, education, employment status, poverty, financial hardship, and use of charity. Factors associated with charity use are race, poverty, financial hardship, food insecurity, and use of three or more public programs. Use of informal monetary support was associated with race, 1-6 months of unemployment, financial hardship, religious attendance, and lending money to others.
Conclusions and Implications: Within demographic subgroups there are significant differences in the use of each type of support. These findings can guide policy makers and nonprofit charities in understanding patterns of use and how to better target their programs. In addition, it can inform the direction of further research in the mixing of various types of supports for low income households.