Benefit programs in Illinois punish people for hard work. An estimated 710,000 Illinoisans have intentionally held themselves back financially to avoid losing government benefits.
Nearly 1 in 4 people on government assistance nationwide actively avoid career advancement to maintain eligibility for benefits turning down promotions, working fewer hours, declining job offers or avoiding building up savings.
With 3.2 million Illinois residents living at or below 200% of the federal poverty level, that translates to over 700,000 individuals who’ve made similar sacrifices to retain their eligibility for benefits. In one example from the University of Chicago, a modest $1,000 raise from $54,000 to $55,000 can trigger a loss of over $25,000 in childcare benefits for a family in Illinois. A bump in income can leave a family worse off than before.
The real value of benefits: What’s at Stake
A new model estimates the maximum amount low-income residents can receive in total public assistance, depending on their circumstances:
- $26,000 – Single adult, non-disabled, no children
- $38,000 – Single adult, disabled, no children
- $66,000 – Single adult, non-disabled, with two children
- $80,000 – Single adult, disabled, with two children
These totals reflect combined support from Supplemental Nutrition Assistance Program, housing subsidies, childcare assistance, Medicaid and other programs. Losing these benefits abruptly due to a modest pay raise can be devastating. This creates a powerful disincentive to enter the workforce or to earn more through career advancement.
To fix this, policymakers need to reform how benefits phase out. Federal action should focus on gradually tapering benefits so workers always come out ahead financially. Illinois lawmakers should smooth out cliffs in programs under their control, such as Temporary Assistance for Needy Families.
Local governments should test pilot programs that ease transitions off public assistance and invest in financial literacy tools to help families navigate benefit cliffs.
Rather than discouraging work, government programs should serve as a launchpad to self-sufficiency – not a trap that forbids upward mobility.
