The challenges common with benefits cliffs and plateaus—and the Federal Reserve’s efforts to study and address them—are explored at External

For some lower-income workers, even slightly higher pay can mean the loss of hundreds or even thousands of dollars in public assistance benefits. In recent years, the Kansas City and Atlanta Reserve Banks began working with state agencies and community organizations to explore that dilemma.

Now those Fed Banks, and others, have a suite of tools and strategies that states, local organizations and career counselors can use to better inform workers facing that “benefits cliff.” The challenges inherent with benefits cliffs and plateaus—and the Federal Reserve’s efforts to study and address them—are detailed in an article at External focusing on the personal stories of three individuals, including a worker in Colorado. The article, titled “A hand up, not a handout, to cross the benefits cliff,” also highlights Atlanta Fed research showing how losing public assistance benefits incentivizes some individuals to stay in low-paying jobs and discourages others—who are willing to work—from joining the labor force.

“Public benefits can be a lifeline for families in need, but the fear of losing them without a sure pathway to a stable, better-paying job can hold people back,’ said Steven Shepelwich, Kansas City Fed senior community development advisor. Shepelwich is leading Tenth District initiatives to address benefit cliffs and is helping coordinate strategy with other Reserve Banks.

One of the tools developed and supported by the Atlanta and Kansas City Feds is a customizable dashboard that some organizations in the Tenth District are using to help workers explore the potential returns of different careers, taking into account eligibility for public benefits.

Another tool—a more detailed financial planner—helps workers see a complete picture of their household finances as they consider career moves. A third tool, called a “snapshot,” helps workers in crisis develop an immediate path to financial stability. The tools are aimed at workers, but they also can help inform employers.

For example, in Colorado, the state’s Workforce Development Council partnered with the Kansas City and Atlanta Feds to implement a customized dashboard that “allows the workforce centers to educate an employer on the different aspects of an employee’s life that they need to be thinking about if they’re going to be offering the highest level of quality within their job opportunities,” Lee Wheeler-Berliner, the Colorado Workforce Development Council’s managing director explains in the Fed Communities report.

Several states across multiple Federal Reserve districts have begun using the benefits cliff tools. The tools, training modules and related research are available to the public at the Atlanta Fed’s website,, under the acronym CLIFF (Career Ladder Identifier and Financial Forecaster).

In the Tenth District, a partnership is underway with the Oklahoma Office of Workforce Development, and the New Mexico Direct Caregivers Coalition is using the dashboard to inform policy and practices in the state. That organization is led by Executive Director Adrienne Smith, who is a member of the Tenth District Community Development Advisory Council. This year Shepelwich and colleagues have met with state government officials in the District to discuss how these tools can be used to improve workforce development outcomes and inform policy.

“Addressing benefits cliffs can provide immediate relief and hope to workers struggling to provide for their families,” Shepelwich said. “It is also key to helping employers find and develop workers that are in such demand in today’s labor market. More partners putting these tools to work will help us learn new ways of building an economy that works for all.”