Families on TANF in Illinois: Employment Assets and Liabilities. Summary of Findings

06/10/2003

What are the welfare and employment experiences of TANF recipients in Illinois?

Most single-parent TANF cases in Illinois are not long-term recipients of assistance. Nationally, close to half of all TANF cases have received assistance continuously for two or more years. But in Illinois, only 39 percent of TANF cases have continuously received assistance for that long. The median duration of the current welfare spell is 16 months. The relatively short time on welfare may be attributable to the state's particular combination of incentives and penalties that encourage work and self-sufficiency.

To promote work, Illinois provides a 67 percent earned-income disregard and stops the 60-month TANF clock for single-parent cases in which heads are working 30 or more hours per week. This means that a single-parent TANF case head with two children can earn up to $1,100 per month before she is ineligible for a cash grant. It also means that a case head who has received cash assistance for 36 months, for example, but has worked 30 hours per week for 20 of those months, would log not 36 but 16 months on her TANF benefits clock. As a result, most cases have no more than 24 elapsed months on their TANF clocks, and only 3 percent are at risk of reaching the 60-month lifetime limit on assistance within one year. In addition to these incentives to work, Illinois penalizes noncompliance with program requirements, including the work requirement. One-quarter of all single-parent TANF cases are under a sanction, and 9 percent of these cases are under a full-grant sanction.

Two out of every five TANF recipients are currently working for pay, but they do not work enough hours, earn sufficiently high wages, or remain in jobs long enough to achieve self-sufficiency. Compared with former TANF recipients across the nation, a smaller percentage of current TANF recipients in Illinois work full time, and their median rate of pay of $6.50 per hour is about 10 percent lower. About half of all recipients who held a job at any time worked in their most recent position for only five months or less. Only 6 percent of these jobs have the characteristics that are likely to lead to greater self-sufficiency in that they pay over $8.00 per hour, are not temporary or seasonal, involve daytime hours, and make paid leave (vacation and/or holidays) and health insurance available to qualified employees.

Notwithstanding the incentives for employment, the heads of many single-parent TANF cases in Illinois have limited attachment to the labor market. Three-fifths of them are not currently employed. One-fifth have not been employed during the past year, and three percent have never been employed.

What assets and liabilities do TANF recipients bring to the labor market?

The heads of single-parent TANF cases in Illinois have relatively weak educational backgrounds, but most bring other human capital assets to the labor market. Slightly more than half of these individuals have a high school diploma or a GED, compared to about three-fourths of TANF case heads in Michigan and Nebraska. However, about three in every four case heads in Illinois have made an effort during the past year to increase their human capital by participating in an employment-focused education or training program. About three-fourths of Illinois TANF case heads also have worked for pay during the past two years and are familiar with at least four common job tasks such as talking with customers in person or by telephone, doing arithmetic, or filling out forms. Some case heads have very substantial recent work experience: nearly half of them have been employed in at least four of the last eight calendar quarters.

Despite their assets, TANF recipients face a number of personal liabilities for employment, the most prevalent being poor physical and mental health. One-fifth of the heads of single-parent TANF cases in Illinois have a physical health problem, and one-quarter have a mental health problem. These rates are similar to those documented in studies of current and former TANF recipients in other states. Lower proportions of case heads have a history of multiple arrests (16 percent), have experienced severe domestic violence in the past year (13 percent), or are at risk for a learning disability (12 percent). And only a very small proportion is chemically dependent (3 percent) or has a language difficulty (2 percent).

Logistical and situational liabilities for employment are more prevalent than personal liabilities. The single most prevalent liability of this type is neighborhood problems. Over half (55 percent) of TANF recipients believe that their neighborhood is home to a serious problem related to crime, drugs, unemployment, or poor housing. One-fifth to one-third of recipients have each of the other logistical and situational liabilities measured in the study. These include an unstable housing situation characterized by multiple moves or an eviction in the past year. Despite the extensive public transit system in Cook County, where most Illinois TANF recipients live, it is not unusual for them to encounter transportation problems that interfere with their ability to work or participate in work-related activities. The situational liability with the lowest incidence is discrimination by a potential employer on the basis of race, gender, appearance, or welfare receipt. However, a full 20 percent of case heads who have ever worked for pay believe that a potential employer discriminated against them during the past year.

Family circumstances can also constitute logistical and situational liabilities for employment. About one-third of TANF case heads care for a family member or friend with a health or behavioral problem or a special need. Providing this care may limit the head's availability for work. Approximately the same proportion of heads is either pregnant or caring for an infant in her household, both of which may influence a parent's job performance and decisions about employment as well as an employer's decisions about hiring. Among single-parent case heads, one-third have had child-care problems during the past year that have interfered with their ability to participate in work or training.

What are the effects of the number and type of liabilities on employment?

Multiple liabilities for employment are extremely common among the heads of single-parent TANF cases in Illinois. Only 4 percent of case heads have none of the liabilities for employment measured in the study, and 12 percent have just one. On average, TANF case heads have 3.6 liabilities for employment, and those who are not substantially employed (not working 30 or more hours per week) are much more likely to have multiple liabilities than are those who are substantially employed. Among those not substantially employed, the presence of multiple human capital and multiple logistical and situational liabilities is more pronounced than the presence of multiple personal liabilities.(1)

Findings from multivariate analyses indicate that few individual liabilities alone actually affect the likelihood that the head of a single-parent TANF case will be substantially employed when background characteristics and the presence of other liabilities are held constant. Rather, the presence of multiple liabilities decreases the probability that a case head will work 30 or more hours per week. Only 4 of the 16 individual liabilities examined in the study have a significant negative association with employment. Limited recent work experience, a physical health problem, multiple arrests, or a child care problem significantly reduce the likelihood of substantial employment. Consistent with studies of current and former TANF recipients, we found that as the number of liabilities increases, the probability of working decreases. TANF recipients without any liabilities have a 58 percent likelihood of working 30 or more hours per week. The probability drops to 35 percent for those with one liability, 33 percent for those with two or three liabilities, 23 percent for those with four to six liabilities, and to just 7 percent for those with seven or more liabilities.

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