Welfare-to-work activities are just one of the policy initiatives around which One-Stop systems are organized. Other initiatives based in the U.S. Department of Labor are also driving the move toward One-Stop systems. These include the move to Unemployment Insurance (UI) call centers for processing all UI claims and the school-to-work transition initiative. The connections between One-Stop systems and community colleges are also important in the national move to boost access to these educational opportunities via tuition subsidies. And finally, the status and availability of economic assistance for working families - for child care, food, health, and housing - may prove to be an important factor in determining the efficacy of One-Stop systems in helping these families become self-sufficient.
State employment services agencies have been undergoing significant redesign in response to changes in technology, customer demands, and the declining purchasing power of federal aid to support these services. One of the critical elements in this transformation has been the shift of many states to the use of call centers for the filing and processing of UI claims, eliminating the need for numerous local unemployment offices. For example, in Wisconsin, 54 local UI offices were consolidated into two call centers, one in Milwaukee and one in Madison.
The rationale for this redesign was to create greater efficiencies for both the employment agency and its customers. UI call centers in Wisconsin have reduced space requirements and building maintenance by 50 percent, and have incorporated an automatic profiling process for immediate referral of long-term dislocated workers to employment services. Wisconsin estimates that this move reduced their staffing requirements by 25 percent, saving roughly $1 million annually in administrative costs. In addition, they estimate that customers realize as much as $11 million in benefits through the elimination of long drives to local offices, parking, standing in lines, child care, and service response time.
The move to call centers has a significant impact on the design of the employment service delivery system at the local level. Without the overhead support of local UI workers, many local Job Service centers have been financially compelled to relocate and/or collaborate with other partners in the same space. This financial pressure is one of the most compelling factors driving the development of One-Stop employment service systems. In Kenosha, no UI claims are processed or serviced at the Kenosha County Job Center and all employment services are provided under contract. Most of Kenosha's employment specialists were quite clear that without the collaborative efforts of their partners, they would not have the resources to staff their resource room and provide job search and placement counseling for their welfare and other clients. Thus, the move to UI call centers has made the development of One-Stop systems a necessity if employment services are going to continue to be made available.
The net effect of these linked policy initiatives on employment services does not necessarily have to be negative. Again, in Wisconsin, which combined these efforts with the implementation of JobNet, its computer-based touchscreen employment exchange system, reports significant improvements in job referrals and employment rates for registered job seekers.
Not all states are moving toward these complementary systems at the same rate. For example, in Michigan, initial claims were still handled in person by the Michigan Employment Service Agency (MESA) at the One-Stop office, but all subsequent claims contacts were handled by phone. However, not long after our site visit, Governor Engler announced his intent to abolish MESA, although it is unclear what this might mean for the UI claims process. In Marshalltown, UI claims were still handled at the Workforce Development Resource Center. In Bellingham, UI claims were handled by the Employment Security Department in a separate building near the Center for Workforce Training; although the state plans to implement UI call centers within the next 18 months. Thus, as some of these states move to UI call centers, the financial pressures for maintaining local facilities and overhead may intensify the mandate for local collaboration among the remaining workforce development services.
During the early 1990s, several initiatives were launched to try and improve the transition from school to work for many young workers (e.g. School to Work Opportunities Act). The thrust of this initiative was to provide persons still in high school a greater connectivity to the expectations, realities, and opportunities of the workplace. This experience is hoped to provide students with a better appreciation of the value and use of the education and training they are receiving, and to help them think and plan realistically about how to start and shape a productive career.
The connection between this policy initiative and the One-Stop models visited was rather weak. A few of the One-Stop managers reported serious and systematic efforts to reach out to the school system, going to make presentations about the labor market and career services available at the One-Stop, and in at least one case, inviting classes to visit on field trips. However, there was little evidence that the One-Stop systems are being used to bring employers and schools together to any great degree, nor was there any real indication that schools are making greater use of the local labor market information available at the One-Stop to help students understand the world of work they are about to enter.
The relationship between promoting the transition from welfare-to-work and school-to-work did not appear to be a major concern in our discussions with One-Stop officials. For many, the school-to-work initiatives lacked any programmatic significance, either as a result of lack of resources (time, staff, and funding) or disinterest on the part of local public school (K-12) officials. Only in Tarrant County was the local school district an active participant in the One-Stop partnership. In this instance, the school district provided the adult education component of the One-Stop services, and seemed to be genuinely interested in strengthening and expanding this partnership.
In most cases, the strongest connection between local educational institutions and the One-Stop was with the local community or technical college. In Marshalltown, for example, the Promise JOBS counselors were hired under contract with the local community college, which was located just across the freeway. A significant proportion of the Promise JOBS participants in Marshalltown were enrolled or expected to be enrolled in community college coursework. In Bellingham, a high share of the program participants in the focus groups were similarly connected to the local technical college - although this connection is likely to change under Washington's new WorkFirst program.
However, connections to community or technical colleges were not the same in all locations. For example, in Kenosha, program participants complained that the location of Gateway Technical College was inconvenient relative to the Job Center. Even though the College is a partner in the Job Center, its presence at the Center was not as strong as in other sites, especially with adult education services being provided by an independent contractor. By contrast, the One-Stop center in neighboring Waukesha County is located on the community college campus - established and paid for in part by the community college, and serving almost as an employment placement center for the college's students and graduates.
There are several factors that seem to affect the relationship between the community or technical college and the One-Stop systems. The first is simply a function of local institutional history and personalities of the participants. Leadership in some community colleges simply does not see welfare clients as a primary client base.(25) In some cases, the emphasis on "work first" models for welfare reform, which tend to de-emphasize post-secondary education and training, may be causing community colleges to discount their relationships with welfare-to-work programs. Unless these welfare reform initiatives make some provision for follow-up encouragement and support for education and training once participants find employment, the relationships with community colleges may deteriorate. On the other hand, active involvement by the community college in the One-Stop system from the start seems to bring a greater emphasis on the need for this kind of follow-up support and encouragement.
If "successful" One-Stop service delivery models are defined as those that lead parents from welfare to self-sufficiency, then the focus of the One-Stop programs needs to expand beyond employment services to include a wider array of economic supports for parents who work for low wages. Many of these supports are clearly acknowledged in the welfare-to-work process, including the provision of child care, health care, and transportation assistance. However, in most of the One-Stop models assessed by this report, these benefits are phased out after welfare recipients find employment that raises their incomes past the threshold for cash assistance.
In most cases, health care coverage (generally Medicaid) is phased out for adults 12 months after termination of cash welfare assistance.(26) Child care and transportation assistance are somewhat more problematic, generally tied to JTPA enrollment and thus dependent to some degree on local design. In most cases, funds for child care seemed to be adequate for participants in the focus groups with the exception of children with health needs, although availability of child care to match many low-wage work schedules and geographical locations is still a problem. In most cases, the added funding for child care that accompanied the federal legislation has helped make the process of job search more palatable, but the reality of the low-wage labor market is that most families who have made the transition from welfare to low-wage work cannot often afford unsubsidized child care. Even some states that have dramatically increased child care funding from their own resources, such as Washington, still find that these combined federal and state resources fall far short of the support that is needed.(27)
Housing assistance is also problematic. Nationally, over 30 percent of AFDC recipients also received federal housing assistance in the late 1980s.(28) This proportion seemed to vary considerably in the sites visited, based on anecdotal information provided during focus groups. Tarrant County seemed to be the only location where most current welfare recipients lived in public housing or received Section 8 housing assistance. This is not surprising, since it was by far the largest urban area included. It would appear that the overlap between cash welfare assistance and public housing assistance declines as the service delivery areas become more rural. As a result, most of the current program participants in the focus groups did not receive housing assistance. Under most publicly financed housing assistance programs, housing costs are kept to 30 percent of a household's monthly income, and families are rarely ever forced out of publicly owned housing. However, some families earning higher incomes may loose their eligibility for tenant based Section 8 assistance, but generally only after their incomes rise above 80 percent of the area median family income.
Because federal Food Stamp and Earned Income Tax Credit (EITC) assistance eligibility is based on income rather than other program eligibility, this support continues to be available to many parents who find low-wage work. Thus, the real household budget challenges for parents working at low-wage jobs continue to be child care, housing, and health care.
Of the sites visited, Kenosha seemed to have the most complete set of economic supports available to serve parents trying to reach self-sufficiency via low-wage employment. Wisconsin's W-2 program is designed to provide both health care and child care for working families on a sliding fee scale based on income, rather than program eligibility. Additional economic supports, such as Food Stamps, can be accessed at the One-Stop as well. Economic service workers in Kenosha (and Waukesha as well) note that the caseloads for these programs have remained relatively constant while welfare caseloads have dropped over time. This pattern illustrates the importance of these services in maintaining working families as they acquire the work experience and on-the-job skills necessary to earn higher wages. Nonetheless, several welfare advocates continue to question whether the levels of co-payments for some of these services are appropriately scaled, recognizing that many families may not reach self-sufficiency until their income reach or exceed roughly 200 percent of poverty.(29)
This concern was repeated in most of our site interviews. One-Stop caseworkers continually raised the question of whether welfare reform meant moving families from welfare to low-wage work, or from welfare to self-sufficiency. Most of these workers tried hard to prepare families for the struggles of making ends meet once they left the TANF program, making sure they understood issues of eligibility for other assistance programs. However, given the lack of resources for follow-up education and training, many of these workers remained skeptical of whether a higher proportion of their clients would achieve long term self-sufficiency, and many expressed concern about the prospects for higher need clients who now make up a larger proportion of their current caseloads.
Thus, the availability of economic support services is often critical to achieving self-sufficiency for working parents. Although many of these services are provided by state or local public agencies, it is important to note that in some states roughly half of the funding for these services is provided by federal aid.(30) Planned reductions in discretionary federal spending by roughly 10 percent (adjusted for inflation) during the next 5 years may mean that some of the federal aid for these services will be at risk, and that the demands on state resources to provide these support services may grow over time.(31) Certainly as some of the states achieve significant reductions in welfare caseloads, state policy makers will need to be increasingly concerned about the roll of these and other support services (such as mental health and substance abuse treatment) if they expect the caseload decline to continue.
26. Children might continue to be covered under Medicaid, depending on family income and the level of coverage in a given state.
27. Richard Brandon and Carol Naito, Financing Child Care in Washington State, Human Services Policy Center, University of Washington, October 1997.
28. Sandra J. Newman, "The Implications of Welfare Reform for the Housing Assistance System," Paper presented to the 1995 APPAM Research Conference, Washington DC, November 1995.
29. James McIntire, Richard Brandon, Robert DeWeese, Carol Naito, Julie So, and Abhay Thatte, Policy Choices for Working Families in Washington: A Baseline Analysis of State Economic Support for Working Families, Fiscal Policy Center, University of Washington, March 1997.
30. Ibid.
31. James McIntire and Julie So, Impacts of the 1998 Budget Agreements on King County, Fiscal Policy Center, University of Washington, June 1997.
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