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Welfare Reform
Tracking Recipients after They Leave Welfare
Jack Tweedie, Dana Reichert and Matthew O'Connor, Children and Families Program
August 1999
State and federal efforts to transform welfare into a work-based system have contributed to an unprecedented reduction in states' welfare caseloads. Nationwide caseloads have dropped by more than 40% since fiscal year 1994. States are encouraged, particularly because the caseload drop shows that the welfare system can be changed. States' purposes in welfare reform go beyond reducing caseloads, however. They want to move recipients into work so that they can support their families without welfare payments and other government support.
As caseloads drop, states are realizing that they need more information about the recipients leaving welfare-whether they find jobs, what kinds of jobs they find, what services they continue to use, and whether they face difficulties in feeding and housing their families. Most states have now begun studies of the families that leave welfare or those that are cut off welfare because they do not comply with new requirements or they reach a time limit. While some states focus on families who leave welfare because of sanctions or time limits, most states have examined the full set of closed cases.
States have taken a variety of different approaches-mail surveys, home visits, telephone surveys and matching of case closures with unemployment insurance records. We report here on administrative data matching and telephone and in-person visits. We do not include mail surveys because the response rates are too low to justify much confidence in the findings. States are generally improving their methods of collecting information about families who have left welfare-often combining administrative data with surveys and using both telephone and in-person visits to increase their response rates.
States continue to develop their approaches even as they begin to report their findings. Initial studies focused on the number of former recipients who were working and whether they faced significant hardships, such as not having enough money for food or becoming homeless. State studies are now addressing some of the questions raised by the findings in the early studies. These studies found that a significant percentage of families were not working, raising the question of how they were supporting themselves. Several states have now included questions about a variety of government, family and community sources of support. Surveys are also beginning to address questions about whether former recipients remain employed after leaving welfare and whether they increase their earnings over time.
The welfare project at NCSL is collecting all state-sponsored studies of families who leave welfare. Eighteen states have released studies that provide good information about the status of families who leave welfare. Many other states are currently engaged in planning or implementing similar studies. Some of these studies examine all families who leave welfare; others focus on families who lose benefits because of sanctions. Because of the intense interest in what is happening to these families, we are making summaries of their findings available as we locate and analyze studies. Short summaries of those studies that focus on findings regarding the work experience and the well-being of former recipients have been compiled here. Each study is different and should be read with caution, particularly where response rates are below 60 percent.
Several other states have conducted mail surveys or small sample telephone surveys. We have not included those studies because the low response rate or the small sample size does not provide a sufficient basis for confidence in the findings.
State tracking studies provide information concerning critical questions about what is happening to the large number of families leaving welfare. While these studies do not provide the basis for any general conclusions about the success of reforms, they provide us with the first set of data regarding the effects of welfare reform. They illustrate both the positive results of welfare reform-more ex-recipients are working; and the remaining questions-How do we move recipients who are not working into jobs so they can establish stable support systems for their families? Furthermore, we do not yet know whether recipients will be able to keep their jobs and how an economic downturn will affect them. Looking at the studies as a whole, however, suggests several findings at this early stage:
Employment and Work
- Most recipients who leave welfare are finding jobs. In a majority of surveys and administrative data reports, between 50 - 70% are currently employed or have work earnings. This work rate is around 5 - 10% higher than the proportion of recipients who left welfare for jobs under the AFDC program. The Mississippi result is an exception. Only 35% of respondents said they were working at the time of the survey.
- Significantly fewer recipients who are sanctioned for not complying with new requirements find work. Studies focused on sanctioned cases find employment rates ranging from 20% to 50%.
- Most of the jobs pay between $5.50 and $7.00 per hour, higher than minimum wage but not enough to raise a family out of poverty. Most jobs are in the services and retail trade. So far, few families who leave welfare have been able to escape poverty.
- There is some evidence from Maryland, Colorado and Arkansas that "leavers" are staying in jobs and that their earnings increase somewhat over time. This is a critical question as attention turns from getting recipients off welfare and into jobs to keeping families off welfare and helping them move toward self-sufficiency.
- Cross-sectional studies being carried out over time have not shown much difference in work outcomes for families leaving welfare recently compared to those who left as welfare reforms were initially implemented.
Other sources of support
- While most families are working, enough are not working to cause serious concerns. We know very little about the situation of those families, their means of support and the long-term stability of their financial support systems.
- Most families who leave cash assistance programs continue to receive some form of public help-most commonly, food stamps, child care and Medicaid. Many others depend on continuing financial aid from family and friends.
- About one-fifth to one-third of the families who leave welfare return within several months. About two-fifths of sanctioned families return.
Continuing barriers to employment
- Child care and transportation continue to be difficult barriers for many families. Many recipients cannot work because of their own or a family member's disability or other health problem.
Family well-being - deprivation
- Many families who have left welfare say they are doing better without welfare and/or that they have more money. But, when asked, a substantial majority says that they are still struggling to get by.
- Some families face hardship or deprivation-not enough money for food or rent--but most do not. There is little evidence from these surveys that many families are becoming homeless or that children are being neglected or abused or going into out-of-home care.
States continue to adapt their welfare programs based on these findings. They are in a good situation to make further changes as the caseload reductions in most states means that states have substantial resources to invest in further services to help welfare recipients overcome the barriers to finding work and supporting their families without cash assistance.
View Summaries
For more information on state welfare reform, please contact Jack Tweedie, Lucy Dwight, Courtney Jarchow or Andrea Wilkins at NCSL, 303-830-2200.
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