When Congress tightened work requirements for federal benefit programs in the One Big Beautiful Bill Act last summer, the rationale was familiar: Benefits should be a pathway to self-sufficiency. Get people into a job, the logic goes, and the rest follows.
This work-first framework, however, leaves out something research shows matters enormously for long-term economic well-being: education beyond high school.
Our newly published study of nearly 3,800 low-income young adults finds that federal public benefits—including the Earned Income Tax Credit (EITC), Medicaid, or food and housing assistance—help people invest in college credentials. The result is higher earnings, lower poverty rates, and greater upward mobility in the years that follow. Designed with this in mind, benefits could do more.
We used nearly 30 years of data from the U.S. Bureau of Labor Statistics' National Longitudinal Survey of Youth to construct a nationally representative sample of low-income young adults aged 18 to 35: what public assistance each received, what educational decisions each made, and what their economic circumstances looked like as they approached 40.
Two findings stood out. Young adults who received the EITC in a given year were 36 percent more likely to enroll in post–high school education the following year than in years they did not receive it. And they were 63 percent more likely to enroll if they received food aid through the Supplemental Nutrition Assistance Program (SNAP). The trends we saw didn't stem from some subgroup with particularly high motivation; we were comparing the same person's behavior from one year to the next. These associations also held true even after controlling for age, family income, whether they had children, and stable individual characteristics.
So, what's going on here? It is often short-run financial constraints—not enough money to cover rent, food, or basic expenses while also paying for school—that keep young adults out of the classroom. Public benefits appear to relieve enough pressure to make enrollment possible.
Once enrolled, benefits also help students stay. Food and housing insecurity are two of the main reasons people leave college without finishing, earlier research has shown. Consistent with that, we found that each additional year students received the EITC while enrolled was associated with 40 percent higher odds of graduating.
The payoff is substantial. The low-income young adults in our study who got a bachelor's were making about $18,400 more a year by their late 30s or early 40s than peers who worked but did not pursue education beyond high school. Graduate degree holders earned roughly $40,600 more. Associate degree recipients didn't get the wage premium, but they showed significantly lower poverty rates and were more likely to earn more than their parents did—a concrete measure of economic mobility.
You might think financial aid—scholarships, loans, work-study—should handle this. But financial aid only reaches people who already made it through the door. Public benefits do something different: They help people clear the enrollment hurdle before financial aid kicks in. Once in school, the combination of benefits and financial aid helps low-income students stay and finish.
Once in school, the combination of benefits and financial aid helps low-income students stay and finish.
Yet too often benefit program rules work against that goal. For instance, students enrolled at least half-time in higher education generally cannot receive SNAP. Exceptions exist for those in a work-study program or employed at least 20 hours per week. But research consistently finds that when students spend that many hours at a job, their academic progress begins to suffer.
That's the core tension our findings highlight: Benefit program rules treat education and employment as competing priorities when they are, in fact, complementary paths to the same destination. That means benefit programs should be designed not solely to incentivize immediate employment, but also to support workforce advancement. This is especially true as more and more jobs—including essential ones in health care, technology, and the skilled trades—require formal credentials.
Practical steps are available right now. Policymakers could revisit rules that leave many college students ineligible for food assistance regardless of their income or circumstances. States can also use the flexibility they already have, including the ability to count enrollment in workforce-linked college programs as meeting work requirements—something several states have already done. And most campuses would benefit from coordinating the siloed financial aid and public benefit systems so that low-income students don't fall through the cracks.
The students in our study aren't abstractions. They're the future nurses, engineers, and skilled tradespeople we depend on—many of them studying at the community colleges and regional public universities that this country built to enable economic mobility.
The debate over public benefits often proceeds as though there's only one route toward self-sufficiency. Our data suggest there are at least two. Good policy doesn't force a choice between them. It opens both doors.
