Observational analysis reveals welfare programs offset postnatal earnings losses but leave prenatal gaps for low-income mothers, indicating safety net limitations due to non-fungible nutrition aid.
Employed, social welfare-connected mothers experience a substantial reduction in earnings around a child's birth. Social welfare programs, assuming full take-up, can offset these lost earnings after birth but not during pregnancy. Most social welfare benefits available around birth are nutrition assistance, which are not fungible. These mothers spend about six months out of the labor force, with Black mothers returning earlier, on average.
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Heflin et al. (2026) studied this question.
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