Federal Funding for Social Services

Federal funding for social services fluctuates with economic conditions and federal agendas shaping outlays. Typically, social service funding increases during normal economic conditions (to keep pace with inflation) and increases dramatically during recessions. The government may also implement increases during recessions to help care for the growing unemployed population by providing financial support, housing and training for other professions. Unemployment shot up in 2009 after the recession began at the end of 2008, however social service funding did not boost significantly until 2010. The delay occurred because time had to pass before the new group of unemployed needed the services provided. Unemployed job seekers expecting to find a job soon will unlikely enroll in job training to learn a new profession. In addition, the unemployment rate peaked early in 2010 and as it stayed high over that year, Congress extended the eligibility period for unemployment services, causing social service funding to balloon. As a result, total federal funding for social services grew 11.2% over 2010.

In turn, as the economy began to recover and the unemployment rate fell, federal funding for social services declined from 2011 through 2014 before returning to growth in 2015. The rebound was short-lived, however, as the driver slimmed by 0.8% in 2017. Driven by the economic pressures during the COVID-19 (coronavirus) pandemic, the driver grew 4.0% in 2020 as the federal government strived to stimulate the economy and protect individuals from the virus. However, federal funding stagnated in 2021 following a expanded reopening of the economy in the year, as this had influenced and changed how much aid needed to be allocated in the year especially as more people re-entered the workforce, slumping unemployment levels. While pieces of legislation extended various forms of aid that were granted in the previous year, the expiration of relief that began to peel back in the year also influenced how much spending was allocated for these various programs. However, the approval of various enhanced forms of funding through appropriation bills helped expand funding in the following years, enhancing spending amid inflationary pressures. In turn, funding allocated to social programs will scale up in the latter years of 2024 and 2025 as Congress votes on various types of legislation that keep this afloat.