CONCORD — The New Hampshire Department of Health and Human Services, Division of Economic and Housing Stability and New Hampshire Employment Security have completed an economic analysis that will provide a framework for reducing the impact of the benefits Cliff Effect on New Hampshire families.
The Cliff Effect occurs when new or increased wages lead to an immediate loss or reduction of public assistance, but the increased income does not fully compensate for the loss of these benefits.
The analysis was conducted by Econsult Solutions in partnership with the National Center for Children in Poverty, and looked at key data in New Hampshire’s business climate, social determinants of health and public assistance benefits in order to understand and address the Cliff Effect in communities across the state.
Removing barriers to employment such as the Cliff Effect ensures that parents have the financial stability they need to remain strong and resilient and that employers have access to a growing and vibrant workforce.
“Assessing New Hampshire’s current economic landscape is an important first step in creating a plan to address the Cliff Effect in a systematic and holistic way that puts families first,” said DEHS Director Christine Santaniello. “Instead of a benefits cliff, we envision more of an offramp where families can gradually move away from public assistance and toward upward economic mobility. This analysis will help us to pinpoint which policy levers to shift to provide the most support to New Hampshire families.”
“Over the past year, the COVID-19 pandemic has magnified the impact of the Cliff Effect on New Hampshire families. As people continue to return to work during the pandemic and beyond, it is critical that we address the barriers that families face so we can effectively increase participation in New Hampshire’s workforce. Not addressing these barriers negatively impacts New Hampshire’s economy,” said NHES Deputy Commissioner Richard Lavers. “The report looks at unemployment together with the affordability and accessibility of child care, all through a pandemic lens. The reasons why someone is filing for unemployment together with the issues surrounding child care are so important to better understanding our continued path to economic recovery and growth.”
The Benefits Cliff Working Group, created in 2019 under House Bill 4, will use the data report to assist DHHS in developing a plan to close the Cliff Effect and will make recommendations for future DHHS policy changes and/or legislation.
Additional components of DHHS’s work surrounding the Benefits Cliff Effect include participation in the New Hampshire Chapter of the Whole Family Approach to Jobs, the creation of the Whole Families Integration Team, and the development of a benefits cliff calculator.
To read the economic analysis, go to econsultsolutions.com/nh-cliff-analysis/. For more information on the benefits Cliff Effect, go to dhhs.nh.gov/ocom/solving-benefits-cliff-effect.htm.