The Great Recession and Material Hardship

Abstract

Little research looks at the relationship between macroeconomic indicators and material hardship. High unemployment rates as a result of economic downturns are likely to lead to lost income, increased poverty, and material hardship. We examine the effect of the unemployment rate on hardship – food insecurity, difficulty paying bills, housing insecurity, unmet medical needs, and having utilities cut off – and investigate the role that government safety nets play in mitigating the effects of unemployment on the experience of material hardship. We use data from the Fragile Families and Child Well-being Study. The latest wave of data was collected during the Great Recession, the worst recession since the Great Depression, providing a unique opportunity to look at how high unemployment rates affect the well-being of low income families.Material Hardship, Unemployment, Recession