Local Labor Demand and Program Participation Dynamics: Evidence from New York SNAP Administrative Records

This study estimates the effect of local labor demand on the likelihood that Supplemental Nutrition Assistance Program (SNAP) beneficiaries are able to transition out of the program. Our data include SNAP administrative records from New York (2007 to 2012), linked at the person-level to the 2010 Census, and linked at the county-month-level to industry-specific labor market conditions. We find that local labor markets matter for the length of time spent on SNAP, but there is substantial heterogeneity in estimated effects across local industries. Using Bartik-style instruments to isolate the effect of labor demand and controlling for the changing composition of entrants and program rules brought on by the Great Recession, we find that fluctuations in labor demand in industries with high shares of SNAP participants—especially food service and retail—change the likelihood of exiting the program. Notably, estimated industry effects vary across race and parental status, with black participants being most sensitive to changes in local labor market conditions and mothers benefiting less from growth in local labor demand than fathers and non-parents. We confirm that our results are not driven by endogenous inter-county mobility or New York City labor markets and are robust to multiple specifications.