Helping Your Child Succeed Despite Job Loss (Part 2)- Why U.S. Families Face Greater Risks After Job Loss—And What Needs to Change

Job loss impacts families worldwide, but U.S. parents face even greater risks due to weaker safety nets and rising childcare costs. Discover why American families struggle more and what policy changes could help protect children from long-term developmental setbacks.

Part I Recap – How Parental Job Loss affects Child Development

In Part I of this series, we explored how parental job loss impacts child development and provided strategies to help parents support their children through financial instability. In Part II, we examine why U.S. families may face even greater risks than those studied in Ireland and Australia, and what systemic changes could help protect children from these challenges.

Studies by Mari & Keizer (2021) and Hill et al. (2011) revealed that parental job loss reduces access to early education, increases behavioral issues, and compounds financial stress, which can negatively impact parenting. Research from Khanam & Nghiem (2016) further supports these findings, emphasizing that income loss is only part of the equation—parental time investment, stress levels, and home learning environments play an equally critical role in child development. Their study also reinforces the importance of early skill formation, showing that children’s early learning experiences strongly influence future academic and behavioral outcomes.

While job loss affects families worldwide, U.S. families face unique risks that make recovery harder—including weaker unemployment benefits, higher childcare costs, and a fragmented early education system. This article explores why job loss is even more damaging for American families and what policy changes and personal strategies could help mitigate these challenges.

Why U.S. Families Are at Greater Risk Compared to Ireland and Australia

1. Weak Social Safety Nets Make Job Loss More Harmful

• In Ireland and Australia, unemployment benefits are more generous and last longer than in the U.S. (Mari & Keizer, 2021; Khanam & Nghiem, 2016).
• In the U.S., unemployment benefits vary widely by state and often expire within 12 to 26 weeks, leaving many families without adequate support.
• Hill et al. (2011) found that job loss among low-income mothers led to major disruptions in child behavior—but at least some of these families had temporary assistance through welfare-to-work programs.

Why this matters:

• Since most U.S. families do not qualify for long-term assistance, they have no option but to quickly reduce spending on childcare and enrichment activities, increasing the risk of cognitive and behavioral setbacks.
• Lack of income predictability makes it harder for families to plan for their children’s future, affecting everything from educational stability to healthcare access.

Solution for Families:

• Immediately research state-specific benefits to maximize unemployment compensation, SNAP, WIC, and rental assistance programs.
• Find out if you are eligible for Temporary Assistance for Need Families (TANF)
• Look for nonprofit and community organizations that provide childcare assistance or learning support during job transitions.

2. Childcare Costs Are Even Higher in the U.S.

• Mari & Keizer (2021) found that losing access to formal childcare negatively affected verbal development.
• In Ireland and Australia, childcare costs were high, but government programs helped offset expenses.
• In the U.S., childcare costs are significantly higher, often reaching 30% or more of income for working families with more than one child. This makes it harder for families to create an emergency savings account when parents are working.
• Many U.S. families lack access to universal preschool, meaning job loss can directly cut off a child’s access to early education (Khanam & Nghiem, 2016).

Why this matters:

• When parents can’t afford childcare, children miss out on structured early education that helps build language, social, and cognitive skills.
• The problem isn’t just for low-income families—even middle-class households struggle when one parent loses a job.

Solution for Families:

• Check eligibility for Early Head Start and state-funded Pre-K programs.
• Explore childcare co-ops or shared caregiving arrangements with other families.
• Advocate for expanded childcare subsidies and Pre-K funding in your state.

3. The U.S. “Work-First” Model Prioritizes Rapid Employment Over Stability

• Hill et al. (2011) found that maternal job instability (losing jobs repeatedly) was more harmful to children than a one-time job loss.
• One model of U.S. welfare-to-work programs may push low-income parents into jobs quickly—without ensuring job stability, leading to multiple job losses and financial instability.  Data suggests that a hybrid approach with a balanced mix of employment services, education, and job placement support may offer greater employment stability in the long run.
• Khanam & Nghiem (2016) highlight that job instability, rather than income alone, can negatively impact children’s cognitive and behavioral development.

Why this matters:

• Frequent job loss leads to stress, income drops, and unstable childcare arrangements, which increases child behavioral problems over time (Hill et al., 2011).
• Job stability can be just as important as employment itself when it comes to children’s well-being.

Solution for Families:

• Seek out job training programs that focus on long-term career stability rather than just immediate employment.
• If possible, prioritize jobs that offer benefits, stability, and growth opportunities over quick-hire positions.

4. Parental Employment and Time Investment Matter

• Khanam & Nghiem (2016) found that longer work hours for fathers correlated with lower literacy and math scores in children, likely due to reduced parental engagement.
• This suggests that job instability isn’t just about lost wages—it also disrupts parenting time and routines.

Why this matters:

• Parents who work long, unpredictable hours may struggle to maintain structured learning environments for their children.

Solution for Families:

• Prioritize family time and structured learning activities, even if work schedules are irregular.
• Seek employers with flexible work policies that allow for parental engagement in early childhood learning.

What Needs to Change: Policy Solutions for a More Family-Friendly Economy

The challenges facing U.S. families experiencing job loss require both immediate support and long-term policy changes. Here are key policy shifts that could help American families:

1. Expand Access to Universal Pre-K and Affordable Childcare

• Increase federal and state funding for early childhood education.
• Provide childcare subsidies for middle-class families, not just low-income households.

2. Strengthen Unemployment Benefits

• Standardize longer benefit durations across all states.
• Expand job training programs for parents seeking to change career paths or seek more stable employment.

3. Improve Job Protections for Parents

• Mandate paid family leave policies to reduce economic shocks from sudden job loss.
• Expand workplace protections against unfair layoffs.

4. Decouple Healthcare from Employment

• Expand access to public healthcare options to reduce stress for unemployed parents.
• Make CHIP and Medicaid enrollment more accessible for families facing job loss.

Final Thoughts: Parents Need Support, Not Just Advice

The research by Mari & Keizer (2021), Hill et al. (2011), and Khanam & Nghiem (2016) underscores that job loss affects children in long-lasting ways. But in the U.S., these effects are amplified due to weaker safety nets.

For parents, understanding these challenges is the first step, but real change requires systemic support. Advocating for better childcare policies, stronger unemployment protections, and expanded healthcare options is essential to creating an economy where job loss does not permanently disrupt a child’s future.

References

Helping Your Child Succeed Despite Job Loss

Hill, H. D., Morris, P., Castells, N., & Gennetian, L. A. (2011). Getting a job is only half the battle: Maternal job loss and child classroom behavior in low-income families. Journal of Policy Analysis and Management, 30(2), 310–333. https://doi.org/10.1002/pam.20565

Khanam, R., & Nghiem, H. S. (2016). Family income and child cognitive and non-cognitive development in Australia: Does money matter? Demography, 53(3), 597–621. https://pubmed.ncbi.nlm.nih.gov/27083194/

Mari, G., & Keizer, R. (2021). Parental job loss and early child development in the Great Recession. Child Development, 92(5), 1698–1716. https://doi.org/10.1111/cdev.13517

National Evaluation of Welfare-to-Work Strategies: Data

U.S. Department of Labor: NEW DATA: Childcare costs remain an almost prohibitive expense