Families on TANF in Illinois: Employment Assets and Liabilities. Introduction

06/10/2003

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) dramatically altered the safety net for low-income families with children. Before PRWORA, families were entitled to cash assistance through the Aid to Families with Dependent Children (AFDC) program as long as their income and assets were below certain levels and they met categorical requirements related to, for example, household composition. Since the enactment of PRWORA, eligibility for cash assistance under TANF remains an entitlement in most states, in the sense that families are eligible to receive assistance as long as they meet the program requirements. However, the conditions under which assistance is provided to families differ markedly from those under AFDC. PRWORA introduced a 60-month lifetime limit on TANF assistance and established stronger work requirements. By 2000, the heads of single-parent TANF cases were required to work at least 30 hours per week.

Partly as a result of these changes in program requirements and partly due to a strong economy, welfare caseloads fell by about half from 1994 through 2000. This dramatic drop spawned numerous studies of the employment experiences and well-being of the families that left welfare in the latter half of the 1990s. As a consequence of those studies, we now understand the characteristics of the families that left public assistance and their circumstances following exit. Until recently, however, families on TANF have received far less attention from policy researchers.

The limited information on TANF families suggests that they are likely to be among the most vulnerable and least job ready of all low-income families with children. While it is not clear that these families are, in fact, harder to employ than those receiving AFDC prior to TANF, evidence suggests that liabilities such as low education, lack of work experience, physical and mental health problems, and domestic violence are prevalent among current TANF recipients and more prevalent than among former welfare recipients (Danziger 2001; Loprest and Zedlewski 1999). These liabilities may impede the progress of some recipients in the labor market or prohibit others from entering the labor market at all. The findings presented in this report, based on a study conducted by Mathematica Policy Research (MPR) of single-parent families on TANF in Illinois, will increase our knowledge of the current welfare caseload.

Illinois is a particularly interesting state in which to examine the current welfare caseload. It is in the top third of states in terms of the average number of families on TANF, and the caseload is mostly urban, with just over 80 percent of recipients residing in the Chicago area (Cook County). In addition, the state has a unique set of policies that encourage work through incentives as well as penalties. The incentives include a 67 percent earnings disregard and stopping the TANF five-year benefits clock for months in which single-parent recipients work 30 or more hours per week. The penalties can amount to full grant sanctions for continued noncompliance with work requirements.

This study builds on the data from a number of recent surveys of TANF recipients but comes closest to developing a full picture of the current TANF caseload in a state. This picture is based on a survey of single-parent families in Illinois that were on TANF in November 2001. We deliberately incorporated a number of measures and scales in the survey that were used in recent studies conducted in Nebraska and in Michigan (the Womens Employment Study) for purposes of comparison. Although we refer to these studies throughout the report, they had longer periods between sampling and the start of data collection, making their findings somewhat less representative of current TANF recipients than the findings from this study.(1)

Our survey is also based on the instrument used in studies of the TANF caseload now underway in California, Colorado, Maryland, Missouri, South Carolina, and the District of Columbia. Consequently, the findings presented in this report will be comparable to the forthcoming findings from those studies. The combined findings from these seven studies will provide policymakers and program administrators with much richer information for making decisions about the best ways to meet the needs of current TANF recipients.

This study was made possible through a collaboration of sponsors. The David and Lucile Packard Foundation and the Annie E. Casey Foundation sponsored the development of the survey instrument and survey data collection in Illinois. The Office of the Assistant Secretary for Planning and Evaluation of the U.S. Department of Health and Human Services sponsored the data analysis and production of this report.

 

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