Worse off as income increases?

Michelle is a 33 year old mother of three. This year, she expects to receive a raise from her full time job.  And she's worried sick about it. 

A new report from United Way partner agency Crittenton Women's Union explores the "cliff effect" --  what happens when parents lose the work supports (food stamps, child care subsidies) they've relied on due to an increase in salary. Through research and personal accounts, the report shows that participants with the highest average income ($34,000/year) actually faired worse in terms of self-reported well-being than those with lower incomes.

Crittenton Women's Union interviewed "Erica," a 33-year-old single mother who works two jobs and recently became ineligible for work supports, including MassHealth and Food Stamps, because of her increased earnings from the second job. She earns a salary in the low 30s. In the interview, she said:

"Even though you have a little, you’re making a little bit more money, you’re really not, you’re still in the same category...I don’t see how they think that they’re making it better… it’s not beneficial, actually…
it feels like being punished for making more money... you contemplate whether you want to make more money or not, whether you want to work more hours because you could be at home with your kids and still be in the same situation.."

According to the women living and working on the edge of "The Cliff", the transition off of work supports is made infinitely more difficult because eligibility calculations don't factor in irregular work schedules and inconsistent child support payments, which can be commonplace.

I'll let you read the full report, which is pretty enthralling and a quick read at only 7 pages. But here are a couple examples of the recommendations made in it.

• "Establish a gradual phase-out for all work supports."
• "Change the way income eligibility is determined to approximate average earnings over a longer
  period of time and continue to simplify application and re-certification processes."

The report was prepared by Mary A. Prenovost, MA and Deborah C. Youngblood, Ph.D. Read the rest of the recommendations and stories.

Incidently Crittenton Women's Union also has a great blog called The Voices Project and can be found on twitter.