Child Care Subsidies and Employment Behavior Among Very‐Low‐Income Populations in Three States

Using merged administrative data from welfare reform evaluations in three states, we estimate the effects of child care subsidy use on the length of time it takes for a welfare applicant to move into substantial employment. Findings show that the use of a child care subsidy during an unemployed or marginally employed spell of welfare receipt is associated with between a 0.6 and 1.7 quarter (or 11% to 34%) reduction in the time to substantial employment in two of the three state samples. The positive influence of subsidy use on transitions to substantial employment is strongest for those welfare applicants with the lowest earnings who are mixing welfare and work prior to subsidy receipt.     

Linking program implementation and effectiveness: Lessons from a pooled sample of welfare‐to‐work experiments

This paper addresses the question: How does implementation influence the effectiveness of mandatory welfare‐to‐work programs? Data from three large‐scale, multi‐site random assignment experiments were pooled; quantitative measures of program implementation were constructed; and multilevel statistical modeling was used to examine the relationship between program implementation and effects on short‐term client earnings. Individual‐level data were analyzed for 69,399 sample members and group‐level implementation data were analyzed for 59 local programs. Findings indicate that, other things being equal, earnings effects are increased by: an emphasis on quick client employment, an emphasis on personalized client attention, staff caseloads that do not get too large, and limited use of basic education. Findings also show that mandatory welfare‐to‐work programs can be effective for many types of people, and that focusing on clients who are especially job‐ready (or not) does not have a consistent influence on a program's effectiveness. © 2003 by the Association for Public Policy Analysis and Management     

Financial incentives and welfare reform in the United States

This paper uses a microsimulation model to ask whether welfare recipients in the United States would work full‐time if offered an earnings supplement that was conditioned on full‐time employment. The simulations suggest that the earnings supplement would increase full‐time employment, with little additional cash transfer cost to the government. In contrast, financial incentives currently being used by many of the states are increasing employment and income, but are encouraging primarily part‐time employment. Encouraging full‐time employment is particularly important in light of new time limits on welfare receipt. Faced with a loss of welfare benefits, many recipients may find that part‐time earnings do not allow them to be economically self‐sufficient. © 2001 by the Association of Public Policy Analysis and Management.     

Morbid obesity and the transition from welfare to work.

This paper utilizes a rich longitudinal data set--the Women's Employment Study (WES)--to investigate whether obesity, which is common among women of low socioeconomic status, is a barrier to employment and earnings for current and former welfare recipients. We find that former welfare recipients who are both White and morbidly obese have been less successful in transitioning from welfare to work. These women are less likely to work at any survey wave, spend a greater percentage of months between waves receiving cash welfare, and have lower monthly earnings at each wave. The magnitude of the difference in labor market outcomes between the morbidly obese and those who are less heavy is in some cases similar in magnitude to the differences in these labor market outcomes between high school dropouts and graduates. In contrast, we find no such labor market differences associated with morbid obesity for African-American respondents. This paper documents the relationship between weight and labor market outcomes for the first time among the welfare population. In addition, it investigates whether the correlation for White females is due to unobserved heterogeneity. We find that after controlling for individual fixed effects, the point estimate of the correlation of morbid obesity and each of the labor market outcomes falls considerably and is no longer statistically significant. These results are consistent with unobserved heterogeneity causing the correlation between morbid obesity and labor market outcomes. Findings are similar after controlling for the respondent's mental and physical health.     

The road to economic self‐sufficiency: Job quality and job transition patterns after welfare reform

This paper analyzes the relationships of schooling, the skill content of work experience, and different types of employment patterns with less‐skilled women's job quality outcomes. Survey data from employers and longitudinal data from former and current welfare recipients are used for the period 1997 to early 2002. The analysis of job quality is broadened beyond employment rates and wages measured at a point in time by including non‐wage attributes of compensation and aspects of jobs that affect future earnings potential. This study shows the extent to which lack of employment stability, job skills, and occupation‐specific experience impedes welfare recipients' abilities to obtain a “good job” or to transition into one from a “bad job.” The business cycle downturn has significantly negatively affected the job quality and job transition patterns of former and current recipients. © 2003 by the Association for Public Policy Analysis and Management.     

Do Alternative Base Periods Increase Unemployment Insurance Receipt Among Low‐Educated Unemployed Workers?

Unemployment Insurance (UI) is the major social insurance program that protects against lost earnings resulting from involuntary unemployment. Existing literature finds that low‐earning unemployed workers experience difficulty accessing UI benefits. The most prominent policy reform designed to increase rates of monetary eligibility, and thus UI receipt, among these unemployed workers is the Alternative Base Period (ABP). In 2009, the American Recovery and Reinvestment Act sought to increase use of the ABP, making ABP adoption a necessary precondition for states to receive their share of the $7 billion targeted at UI programs. By January 2013, 40 states and the District of Columbia had adopted the ABP despite the absence of an evaluation of ABP efficacy using nationally representative data. This study analyzes Current Population Survey data from 1987 to 2011 to assess the efficacy of the ABP in increasing UI receipt among low‐educated unemployed workers. We used a natural‐experiment design to capture the combined behavioral and mechanical effects of the policy change. We found no association between state‐level ABP adoption and individual UI receipt for all unemployed workers. However, among part‐time unemployed workers with less than a high school degree, adoption of the ABP was associated with a 2.8 percentage point increase in the probability of UI receipt.     

The long‐term effects of public housing on self‐sufficiency

Recent years have witnessed an intensification of the debate about the fundamental purpose of public assistance to the poor and the effects of these programs on children. This study uses enriched data from the Panel Study of Income Dynamics to examine the effects of living in public housing as a child at some point between 1968 and 1982 on four young adult outcomes: welfare receipt; individual earnings; household earnings relative to the federal poverty line; and employment. Living in public housing during childhood increased employment, raised earnings, and reduced welfare use, but had no effect on household earnings relative to the poverty line. The beneficial effects could have arisen because public housing improved physical living conditions, reduced residential mobility, or enabled families to spend more of their income on items that benefit children's development. Whether these effects apply to contemporary public housing is unknown. © 2002 by the Association for Public Policy Analysis and Management.     

Marriage patterns among unwed mothers: Before and after PRWORA

The promotion of marriage and two‐parent families became an explicit public policy goal with the passage of the 1996 welfare reform bill. Marriage has the putative effect of reducing welfare dependency among single mothers, but only if they marry men with earnings sufficient to lift them and their children out of poverty. Newly released data from the 2002 cycle of the National Survey of Family Growth (NSFG), along with data from the 1995 cycle, allow us to compare pre‐ and post‐PRWORA differences in (1) cumulative marriage rates among unwed mothers, and (2) patterns of marital choice (that is, differences in characteristics of the men these mothers marry, such as their education and employment status). Overall, our results show that unwed childbearing is associated with lower marriage rates and marital quality. Difference‐in‐difference models show that welfare reform was not strongly associated with pre‐ and post‐welfare reform changes in marriage among nonmarital birth mothers, even among the most disadvantaged mothers. Compared with other women, nonmarital birth mothers also were less likely than other women to marry “economically attractive” men in the post‐welfare reform period. The success of marriage promotion initiatives may depend heavily on whether women themselves are “marriageable” and whether potential spouses have the ability to support a stable family life. © 2008 by the Association for Public Policy Analysis and Management.     

The long‐term effects of housing assistance on work and welfare

This paper examines the long‐term effect of project‐based housing assistance—public housing and private assisted housing—on work, earnings, and welfare receipt. We use the Panel Study of Income Dynamics–Assisted Housing Database to identify women ever living in project‐based assisted housing and to create comparison groups using propensity scores. Analyses show no evidence that moving into this type of assisted housing is associated with sustained reductions in employment rates, work hours, or earnings. Although welfare rates decline, they remain higher for assisted housing recipients compared with nonrecipients. Overall, these findings align with those of recent experimental and nonexperimental studies that include other forms of housing assistance and cover different time periods. © 2009 by the Association for Public Policy Analysis and Management.     

Adolescents' formal employment and school enrollment: Effects of state welfare policies

Variations in state welfare policies in the reform era may affect adolescents through two mechanisms: A competing labor market hypothesis posits that stringent state welfare policies may reduce adolescent employment; and a signaling hypothesis posits that stringent welfare policies may promote enrollment. To test these hypotheses, we use a dynamic joint model of adolescents' school enrollment and formal employment, separating state welfare policies from non‐welfare state policies, state labor market conditions, and unobserved state characteristics. Longitudinal data from the NLSY97 on adolescents aged 14 to 18 and various state data sources over the period 1994–1999 support the competing labor market effect but not the signaling effect. In particular, lower‐income dropouts suffer more severely from fewer labor market opportunities when state welfare policies are more stringent, which indicates that welfare reform may compromise work opportunities for lower‐income dropouts. © 2004 by the Association for Public Policy Analysis and Management.     

Are Reemployment Services Effective? Experimental Evidence from the Great Recession

We examine an experimental‐design reemployment program implemented in Nevada during the Great Recession that required Unemployment Insurance (UI) recipients to: (1) undergo an eligibility review to confirm they were qualified for benefits and actively searching for work and, if deemed eligible, (2) receive job‐counseling services. Our results show that the program expedited participant exit from UI, produced UI savings that exceeded program costs, and improved participant employment outcomes. Analyses of program effects on the UI exit likelihood show that the program's effects are partly associated with increased participant exit up through the time when program activities were scheduled, reflecting voluntary exit of participants from UI to avoid program activities and disqualifications of participants who failed to meet eligibility requirements. In addition, the program induced substantial participant exit from UI in the period after participants fulfilled requirements and their interactions with the program had ended, suggesting that the job‐counseling services offered by the program may have helped participants to conduct more effective job searches. Our findings provide evidence that reemployment programs that combine an eligibility review with mandatory participation in job‐search services can be effective during recessions.     

Incentives,challenges, and dilemmas of TANF: A case study

This paper compares the incentives inherent in TANF (Temporary Assistance for Needy Families), the U.S. welfare system in place after the 1996 reforms, with those of TANF's predecessor, AFDC (Aid to Families with Dependent Children), using the experience in one state, Wisconsin, as an example. Is the new program successful in avoiding the “poverty trap” of the old welfare system, in which the marginal tax rates imposed on earnings and benefits were so high that they discouraged work effort outside a narrow earnings range? As women receiving assistance begin working more hours and earning more, income‐conditioned benefits (Food Stamps, EITC, Medicaid, and subsidies for child care) are reduced and withdrawn, in effect constituting a “tax” on earnings. Under TANF, there is more support for these families, at least in Wisconsin, and so economic well‐being should be higher for most women with earning in this range than it was under AFDC. But marginal tax rates under TANF remain high, and in some income ranges they are higher than under AFDC. Once in the work force, former TANF recipients have earnings over the long run that expose them to very high marginal tax rates, which decrease the benefits of working harder and make it very difficult to gain full eonomic independence. Evidence from other sources suggest that most low‐skilled women have earnings in the same range and so are likely to face similar reductions in benefits such as child care subsidies or the EITC as their earnings increase, even if they are not receiving welfare‐related benefits. © 2002 by the Association for Public Policy Analysis and Management.     

Car ownership and welfare‐to‐work

This study examines the role of car ownership in facilitating employment among recipients under the current welfare‐to‐work law. Because of a potential problem with simultaneity, the analysis uses predicted car ownership constructed from two instrumental variables, insurance premiums and population density for car ownership. The data come from a 1999–2000 survey of TANF recipients in the Los Angeles metropolitan area. The empirical results show a significant independent contribution of car ownership on employment. The presence of an predicted ownership is associated with a 9 percentage point increase in the odds of being employed. Moreover, the results indicate that lowering insurance premiums by $100 can increase the odds of employment by 4 percentage points. © 2002 by the Association for Public Policy Analysis and Management.     

The compensation hypothesis goes east: FDI and welfare state demand in postcommunist countries

While existing research provides evidence that globalisation sparks citizen demand for the welfare state in wealthy Western democracies, less is known about how globalisation affects public demand for welfare elsewhere. This study explores the link between globalisation and welfare preferences in postcommunist countries by examining workers at multinational corporations (MNCs). These workers have previously been found to have lower levels of job security, even in Western Europe. Additionally, in the postcommunist context, MNC employment also frequently offers better opportunities than other available jobs. This combination of risk and benefit creates higher demand for social insurance (such as unemployment insurance) because MNC workers have both higher job insecurity and higher costs of job loss (if the benefits of MNC employment make it difficult to find an equally good job). Original survey data from Ukraine shows that MNC workers experience greater insecurity and are paid more than other workers. They also express preferences for more expansive welfare programmes, prioritising those related to labour market insurance. This pattern of MNC workers’ experience and preferences is confirmed in cross-national survey data from 30 peripheral economies, demonstrating that the compensation hypothesis has wider application than previously shown.     

The Impact of Earnings Disregards on the Behavior of Low‐Income Families

This paper investigates the impact of changes in earnings disregards for welfare assistance received by single mothers following welfare reform in 1996. Some states adopted much higher earnings disregards (women could work full‐time and still receive substantial welfare benefits), while other states did not. We explore the effect of these changes on women's labor supply and income using several data sources and multiple estimation strategies. Our results indicate these changes had little effect on labor supply or income. We show this is because surprisingly few women used the earnings disregards. We discuss several explanations for why this might occur.     

Child protective intervention in the context of welfare reform: The effects of work and welfare on maltreatment reports

Recent changes in welfare policy have produced changes in parental work and welfare receipt. These factors are assessed in relation to investigated reports of child abuse and neglect using survey data on 1998 welfare recipients in nine Illinois counties, in conjunction with longitudinal administrative data on cash welfare benefits, employment, and child abuse and neglect reports. Trend analyses show that rates of child maltreatment reports among welfare recipients have risen since the passage of PRWORA in 1996. Findings from multivariate analyses indicate that parental employment has a protective effect on reports to child protection systems (CPS), that this effect is greatest when combined with welfare receipt, and that this effect becomes stronger over time. Those who receive welfare in the absence of employment face a significantly greater risk of CPS involvement, even compared with those who neither work nor receive welfare. © 2003 by the Association for Public Policy Analysis and Management     

How Pro‐social Motivation Affects Job Satisfaction: An International Analysis of Countries with Different Welfare State Regimes

Employees' pro‐social motivation has been shown to be positively related to job satisfaction, especially when the perceived usefulness of the job to society and other people is high. There is, however, a lack of analyses which include both public and private employees, and it has not yet been studied whether the relationships are robust across welfare state regimes. This study therefore examines the moderated relationship between pro‐social motivation and job satisfaction. Using data from the cross‐national 2005 ISSP survey (14 countries, N = 10,630), it confirms that the relationship between pro‐social motivation and job satisfaction is moderated by perceived usefulness of the job for society and other people. Usefulness again depends on the individual's employment sector (public versus private), and this public–private difference in perceived usefulness also varies between different welfare state regimes. This indicates that sector differences in how pro‐social motivation affects job satisfaction depends on the broader institutional context, and the article therefore contributes with important knowledge for the recruitment and retention of motivated and satisfied employees in a period of changing public–private responsibilities in the provision of welfare services.     

Will employers hire welfare recipients? Recent survey evidence from Michigan

In this paper we present data from a survey of 900 employers in Michigan during 1997. The survey was designed to gauge employer demand for welfare recipients. The results show that, given the tightness of labor markets there, the prospective demand for recipients is quite high—employers report that 3 percent of all jobs currently, and almost 9 percent over the following year, might be available to unskilled recipients. On the other hand, prospective employment is quite highly correlated with measures of unmet labor demand, implying that much of it could disappear during the next recession. Many of the prospective jobs are also found in establishments to which innercity minorities might have limited access, such as small or suburban establishments that receive few black applicants or that recruit informally. Absenteeism and basic skill readiness are potential problems, based on jobs filled by recipients to date or those that are potentially available. The effects of a variety of potential policy responses targeted at private employers (such as job placement efforts and tax credits for employment or training) are considered as well. © 1999 by the Association for Public Policy Analysis and Management.     

Con a voluntary workfare program change the behavior of welfare recipients? new evidence from washington state's family independence program (FIP)

This article examines a voluntary workfare demonstration program in Washington state—the Family Independence Program (FIP)—designed to encourage longer-term investments in employment and training (E&T) activities, with the ultimate objective of achieving economic self-sufficiency for welfare recipients. A unique longitudinal data set is used to compare E&T enrollment and the labor market and welfare outcomes for a sample of FIP clients and a comparison group of Aid to Families with Dependent Children (AFDC) recipients subject to the state's mandatory workfare requirements. Correcting for self-selection, the estimates obtained indicate that FIP's combination of financial incentives, enhanced support services, and a more client-centered environment results in an E&T enrollment rate that is from 9 to 12 percentage points higher during the post-FIP June 1989 to May 1990 period than the rate for respondents subject to the state's workfare program. Relative to the enrollment rate calculated for nonparticipants, FIP net impact estimates in this range represent a 33 to 44 percent increase in E&T enrollment. These results offer a more positive assessment of the potential of a voluntary workfare program to affect the behavior of welfare recipients than does the large-scale FIP evaluation carried out by the Urban Institute. However, both the evidence presented here and the Urban Institute's evaluation suggest that FIP had little impact on employment and earnings but significantly increased welfare receipt and the level of welfare benefits.     

Should Government Go It Alone or With a Partner? A Comparison of Outcomes from a Work Release Program Using Different Policy Tools

This article compares labor market outcomes from two different approaches to a work release program in Illinois: direct provision by a government and a purchase‐of‐service (POS) contract between government and a public charity. Significantly better employment and earnings outcomes were associated with the POS contract. To better understand the reasons for the success of the POS contract, the authors further examined the specific terms of the contract, organizational expertise, and the political context of POS contracts. The results are organized according to the main theoretical assertions. Findings add to the weight of evidence that contractors, like public charities, can be valuable government partners for addressing challenging social policies and programs.