Moving People from Welfare to Work:
Lessons from the National Evaluation of Welfare-to-Work Strategies

The Status Quo and the Interventions

[ Main Page of Report | Contents of Report ]

Contents

Endnotes

As has been documented in many studies, most welfare recipients eventually find jobs, and most do not stay on welfare for long. The challenge for welfare-to-work programs is to improve on these rates of job finding and welfare exit by enabling people to find jobs and leave welfare more quickly, to keep jobs longer and avoid returning to the welfare rolls, or to build their skills while on welfare and then obtain better jobs. A key task of evaluations of such programs is to find out what is the "normal" behavior of welfare recipients over time. Only then is it clear when programs are producing true benefits for people as opposed to leading to levels of employment, earnings, and welfare leaving that would have occurred in any case.

Before examining the outcomes for the control groups in depth, this section opens by briefly summarizing the characteristics of all the adult sample members in NEWWS before they were randomly assigned to the research groups (for their average characteristics, see Table 3). Almost all of them were single women; at the time they entered the study, they were an average of 30 years old and had an average of two children. The majority had at least one child under age 6. (In four of the sites, families could include children as young as age 1; in the other three sites, families could include children as young as 3.) The racial/ethnic makeup of the samples varied from site to site, reflecting the local populations.

One of the most important points to take away from this summary is that, although welfare recipients are a diverse group, a sizeable proportion of them face one or more barriers to steady employment. Among these barriers are a lack of a high school diploma or GED, no recent employment, a long history of welfare receipt, health or emotional problems, a high risk of depression, and a reluctance to leave one's children to go to work. At study entry, about two-fifths of the sample members lacked a high school diploma or GED, having completed an average of slightly less than 10 years of school. These sample members are often referred to here as nongraduates; sample members who had at least one of these credentials are referred to as graduates. A sizeable proportion of people in the sample lacked a work history, had been on welfare for at least five years cumulatively, or both. Slightly more than one-quarter of the sample members reported at study entry that they or a family member had a health or emotional problem. About one-seventh were found to be at high risk of depression. Finally, one-quarter of sample members reported strongly preferring staying home with their children over going to work.

Table 3:
Sample Member's Characteristics at Studay Entry:
Many Welfare Recipients Face Barriers to Steady Employment
Demographic characteristics at study entry
Female (%) 94.1
Average age (years) 30.5
Average number of children 1.9
Had at least one child under age 6 58.4
Barriers to steady employment (%)
Had no high school diploma or GED 41.0
Never worked full time for one employer for 6 months or more 36.8
Had received welfare cumulatively for 5 years or more 33.7
Had health or emotional problems 28.0
Was at high risk of depression 14.5
Was highly hesitant to leave children to go to work 24.7
SOURCE:  Hamilton et al., 2001; Michalopoulos and Schwarts, 2001.

[Go To Contents]

Control Group Outcomes:
How do welfare recipients fare in the absence of welfare-to-work programs?

The experiences of the control group members in the NEWWS sites set the standard against which the program groups' experiences were measured (for the programs' impacts, see the next sections). Through examination of control group outcomes, the following portrait of the characteristics, attitudes, and behavior of welfare recipients who are not subject to welfare-to-work programs emerges.

About three-quarters of control group members found jobs during the five-year follow-up period. But stable employment was uncommon: About three-fourths of those who found jobs were unemployed by the end of the fourth year, although most eventually became employed again. Including all control group members -- that is, averaging in the zero earnings of those who did not work -- the control groups' average earnings over the five years ranged from $12,752 to $25,566, or about $2,500 to $5,000 a year, across the seven sites.(1) Looking only at those who were working at the end of the five years and averaging across all the sites, earnings in the last quarter were $3,110, or, annualized, about $12,500.

Control group members who had a high school diploma or GED at study entry earned an average of $24,196 over five years, whereas people who lacked these credentials at study entry earned an average of $13,231. It was this general phenomenon that led designers of FSA to emphasize education in welfare-to-work programs, in the hope that investments in education would pay off in labor market outcomes.

The positive relationship between education credentials and earnings does not prove, however, that more education leads to higher earnings. To distinguish between correlation and causation, NEWWS examined whether the welfare-to-work programs that required people to participate in adult education activities (particularly classes aimed at helping people attain a GED) boosted outcomes such as attendance in education activities, reading and math literacy skills, and the rate at which people obtained credentials -- and whether the programs thereby increased earnings -- by comparing program enrollees' outcomes with those for people were not subject to any education participation requirement. The results of this analysis are presented in the third section of this document.

By the end of five years, between 17 percent and 37 percent of control group members across sites were receiving welfare, some of them having remained on the rolls continuously and others having left and returned. Over the five years (60 months) of the study's follow-up period, control group members received welfare for an average of 25 months to 38 months, depending on the site.

Over the five years, control group members in most sites took in between $40,000 and $45,000 from earnings, welfare payments, food stamps, and the Earned Income Credit (EIC) -- a refundable tax credit for low-wage workers -- minus payroll taxes, or about $8,000 to $9,000 a year. This combined income typically would have been for a family of three. The proportion of family income derived from earnings ranged from 30 percent to 45 percent.

When they entered NEWWS, virtually all control group members were on welfare and had Medicaid coverage. Although the majority had health care coverage at the end of five years, about one-quarter of them did not, suggesting that many of those who left welfare to work were not able to replace Medicaid with private coverage once their post-welfare transitional health benefits expired. Among those who had coverage, most were covered by public programs such as Medicaid rather than by employer-sponsored or other private plans. Employment in no way guaranteed health care coverage: Of control group members who were working at the end of the five years, between 20 percent and 30 percent lacked coverage; of those who had coverage, only about one-third to one-half obtained it from their employer. Owing to the larger number of public health programs for low-income children than for low-income adults, children were somewhat more likely to have coverage than their parents. Still, about one-fifth of children in the control groups were not covered at the end of five years.

Most control group members enrolled in vocational training or postsecondary education at some point during the five years. Few enrolled themselves in organized job search activities or adult education courses.

Over the five-year follow-up period, less than one-fifth of single-parent mothers in the control groups got married, and a similar proportion added a new baby to their household through birth, marriage, adoption, or foster care.

About one-fifth of the control group members in NEWWS reported having experienced some form of domestic abuse during the fifth year of the study period. Much of this was nonphysical abuse (such as threatening, yelling, or insulting), but between 7 percent and 14 percent of control group members reported having experienced recent physical abuse (such as hitting).

Relative to national samples, school-aged children in the NEWWS control groups were more likely to have repeated a grade or dropped out of school, and younger children were more likely to have behavior problems and were less cognitively ready for school. On measures of child health and safety, the children in the control groups were similar to those in national samples.(2)

[Go To Contents]

Participation in Education and Training:
Can mandatory welfare-to-work programs engage large numbers of people in education and training?

Since the early 1980s, welfare policymakers and program operators have debated what role adult education -- basic education, GED preparation, and ESL classes -- should play in welfare-to-work programs. Even under TANF, discussion about the potential of education to help welfare recipients make the transition from welfare to work continues. Increasingly, a minimum level of reading and math skills and the possession of an education credential are seen as crucial in the current labor market. The concern is centered on welfare recipients who have no high school diploma or GED, since many policymakers view having one of these credentials as a prerequisite for entering the work force. Recipients who have at least one of these credentials are considered to face far fewer barriers to getting jobs. Furthermore, welfare reform efforts are focusing on "hard-to-employ" recipients, many of whom have educational deficits. Finally, in an effort to target scarce resources wisely, there is great interest in determining who would benefit most from adult education.

The first-order question in this debate, however, is whether participation mandates can really induce large numbers of welfare recipients -- about one-half of whom have not finished high school -- to enroll in and attend adult education classes. More generally, there is the question of whether programs can engage more people in adult education activities or vocational training than would participate on their own in any case. The outcomes for the education-focused programs in NEWWS speak directly to these questions.

As shown in Figure 1, during the five-year follow-up period, 40 percent of enrollees in the three HCD programs participated for at least one day -- usually much longer -- in adult education activities, and 28 percent of them participated in vocational training. Participation rates in adult education were much higher for nongraduates (welfare recipients who entered the study without a high school diploma or GED) than for graduates (those who had at least one of these credentials at study entry). In contrast, participation rates in vocational training were higher for graduates than for nongraduates.

The HCD programs increased participation in adult education by 20 percentage points and vocational training by only 5 percentage points. Part of the reason for the disparity in impacts is that, as shown in Figure 1, welfare recipients on their own are somewhat more likely to enroll in vocational training classes than in adult education, leaving programs less room to increase participation in vocational training than adult education relative to control group levels. In addition, many vocational training programs require a high school diploma or GED for entry, which largely rules out this option for nongraduates. Finally, it should be kept in mind that the HCD programs generally did not assign people to college courses.

When people enrolled in adult education as part of a welfare-to-work program, they spent more than three times as many hours participating as did control group members. In addition, the programs increased the proportion of welfare recipients who participated in adult education across a wide variety of subgroups -- for example, among those with very young children, high school dropouts who had not completed school beyond the eighth grade, and those who did not want to go back to school.

Figure 1.
Participation in Education and training over Five Years:
Participation in Adult Education Increased More than Participation in Vocational Training

Participation in Education and training over Five Years:
Participation in Adult Education Increased More than Participation in Vocational training.

Participation in Education and training over Five Years:
Participation in Adult Education Increased More than Participation in Vocational
training

SOURCE: Hamilton et al., 2001
NOTE: The participation rates shown are averages for the HCD and control groups in Atlanta, Grand Rapids, and Riverside

[Go To Contents]

Participation in Other Activities:
What are typical patterns of participation in other types of program activities?

All the NEWWS programs raised participation relative to control group levels. Figure 2 shows the participation impacts, split by type of activity and averaged across programs within each of the four program types shown in Table 2. The employment-focused programs increased participation in job search by approximately 30 percentage points. The education-focused programs -- in which enrollees were often assigned to job search after education or training -- also increased job search participation, but to a much lesser degree. The employment-focused programs were considerably less likely to affect participation in education and training, and when impacts on participation in these activities did occur, they were smaller than the education-focused programs' impacts on job search participation. The Portland program, the only one that combined an employment focus with a mixed strategy for assigning recipients to initial activities, substantially increased job search participation but increased education and training participation as well. Notably, the participation impacts were comparable across a range of subgroups. Where the relevant data were available, participation rates for mothers with young children, for example, were similar to those for mothers with older children.

Figure 2.
Impacts on participation over Two Years, by Activity and Program Type:
Employment-Focused Programs Produced Large Increases in Job Search Participation,
and Education-Focused Programs Boosted Adult Education Participation

Impacts on participation over Two Years, by Activity and Program Type:  Employment-Focused Programs Produced Large Increases in Job Search Participation, and Education-Focused Programs Boosted Adult Education Participation.

SOURCE: Freeman et al., 2000
NOTES: Participation impacts were averaged across programs within each program type.
The Riverside LFA program results include both graduates and nongraduates.
No tests of statistical significance were performed.

Endnotes

1.  Throughout this document, ranges are often presented because specific findings differed from site to site.

2.  Parents with a severely ill or disabled child were generally not mandated to participate in welfare-to-work programs in the early to mid-1990s; as a result, such families were not included in the NEWWS samples. Their exclusion, however, is unlikely to have affected the overall level of assessed health for children in the control groups very much. Data available in NEWWS suggest that less than 3 percent of the exemptions from participation were granted owing to children's severe health problems.


Where to?

Top of Page | Contents
Main Page of Report | Contents of Report

Home Pages:
National Evaluation of Welfare-to-Work Strategies (NEWWS)
Human Services Policy (HSP)
Assistant Secretary for Planning and Evaluation (ASPE)
U.S. Department of Health and Human Services (HHS)