Brookings Papers on Economic Activity

ABSTRACT:

The COVID-19 crisis has led to spiking unemployment rates with disproportionate impacts on low-income families. School and child-care center closures have also meant lost free and reduced-price school meals. Food prices have increased sharply, leading to reduced purchasing power for families with limited income. The Families First Coronavirus Response Act and the Coronavirus Aid, Relief, and Economic Security Act constituted a robust response, including expansions to unemployment insurance (expansions in eligibility and a $600 per week supplement), a onetime payment of $1,200 per adult and $500 per dependent, an increase in SNAP payments, and the launch of the Pandemic EBT program to replace lost school meals. Despite these efforts, real-time data show significant distress—notably, food insecurity rates have increased almost three times over the pre-COVID-19 rates and food pantry use has also spiked. In this paper, we explore why there is so much unmet need despite a robust policy response. We provide evidence for three explanations: (1) timing—relief came with a substantial delay, due to overwhelmed unemployment insurance (UI) systems and the need to implement new programs; (2) magnitude—payments outside UI are modest; and (3) coverage gaps—access is lower for some groups, and other groups are statutorily excluded.