Final Synthesis Report of Findings from ASPE "Leavers" Grants. Average Monthly Income of Welfare Leavers

11/27/2001

Eight of the leaver studies reviewed here obtain data on income through surveys (Arizona, the District of Columbia, Illinois, Iowa, Missouri, Washington, Cuyahoga County, and the Bay Area). Figure V.1 and Table V.1 show that mean monthly incomes range from $1,054 in Illinois to $1,440 in Iowa.29

Figure V.1
Mean Monthly Income of Single-Parent Welfare Leavers: Survey Findings

Figure V.1 Mean Monthly Income of Single-Parent Welfare Leavers: Survey Findings

Note: See table V.1 for more information

Table V.1:
Income of Single-Parent Welfare Leavers: Survey Findings

State/ Study

Exit Cohort Timing of Survey Monthly Income1 ($)
Mean Median

Arizona

1Q98 12-18 months 1,361 2 1,195

District of Columbia3

4Q98 ~ 12 months 1,091 800

Illinois3

Dec. 1998 6-8 months 1,054 895

Iowa

2Q99 8-12 months 1,440 n.a.

Missouri3

4Q98 26-34 months 1,427 1,166

Washington

Oct. 1998 6-8 months 1,208 1,000

Cuyahoga Co.4

3Q98 14-21 months 1,169 n.a.

Bay Area

4Q98 6-12 months n.a. 1,400

1Income data are reported for households in Illinois and Missouri, families in Arizona and Washington, and for welfare cases in all other studies.
2Arizona reports income including food stamps; we present an adjusted version of income, reducing reported income by 7% because 7% of the average family income of welfare leavers in Arizona comes from food stamps. Data calculated from public use data file.
3Income data reported for all cases, not just single-parent cases..
4Includes cash value of food stamps.
Source: See Appendix B for a complete listing of the leavers studies referenced.

Illinois' mean income is somewhat below DC's mean of $1,091, which is the second lowest, while Iowa's mean is only slightly higher than Missouri's mean of $1,427, which is the second highest. Even if one focuses on DC and Missouri, one sees that mean monthly incomes are more than $300 apart. This translates into a difference of over $3,600 a year. Median incomes also vary across the states. In the six studies that report this information, median incomes range from $895 in Illinois and DC to $1,400 in the Bay Area. However, the Bay Area median is far higher than the second highest median income: $1,195 in Arizona. 

There are several important differences across the studies that likely affect reported incomes, but for every potential explanation, there is a counter-example. For example, studies that ask about income a few months after exit are likely to find lower incomes than studies that ask about income one or two years after exit. In fact, Missouri, which asks about income two-and-one-half years after exit, reports a very high average monthly income for leavers. On the other hand, among the studies asking about income a year or less after exit, both Washington and the Bay Area have relatively high incomes while Illinois' average income is, in fact, low. Similarly, surveys that ask detailed questions about income sources, such as Missouri's survey, likely will find higher average incomes than those that simply ask respondents to estimate their monthly incomes in a single question like the DC and Illinois surveys. In addition, income differences may reflect differences in the cost of living. Consequently, it is not surprising to see high average incomes for the Bay Area; however, the average incomes in Iowa and Missouri are also high, yet the cost of living in Iowa is far lower than in California's Bay Area counties. Even if we cannot easily account for the range of reported incomes, it is important to keep in mind that even the highest average incomesaround $1,400 a monthare just about equal to the poverty line for a family of four. 

Next, consider how the incomes of welfare leavers vary based on their ability to stay off welfare as well as on their work status. Table V.2 compares the monthly incomes of continuous leavers with those of all leavers. In the four studies with the information needed to make this comparison, both mean and median incomes of continuous leavers are considerably higher than those of leavers in general. Differences in mean income between continuous and all leavers range from $60 in Washington to $182 in DC; differences in median monthly incomes range from $55 in Illinois to $200 in DC.

Table V.2:
Monthly Income of Single-Parent Welfare Leavers--Comparison with Continuous Leavers: Survey Findings

State/ Study

Mean ($) Median ($)
All Leavers Continuous Leavers All Leavers Continuous Leavers

Arizona1,2

1,361 1,476 1,195 1,265

District of Columbia3

1,091 1273 1 800 1,000 1

Illinois4

1,054 1,131 895 950

Washington

1,208 1,268 1,000 1,100

1Data calculated from public use data file.
2Arizona reports income including food stamps; we present an adjusted version of income, reducing reported income by 7% because 7% of the average family income of welfare leavers in Arizona comes from food stamps.
3Income data reported for all cases; not just single-parents.
4Data differ from table V.1 because we present information on all leavers here.
Source: See Appendix B for a complete listing of the leavers studies referenced.

Table V.3 compares the incomes of leavers by their work status. Only Arizona, DC, and Washington produced public use data files that allow us to make this comparison. The table shows that currently working leavers have monthly incomes far above those of leavers in general. For example, mean monthly income for working leavers in Arizona is $1,727, almost $400 higher than the mean for all leavers. Similarly, in DC and Washington, the mean employed leaver has a monthly income that is over $250 higher than the average leaver. In addition, working leavers in all three sites have higher incomes than leavers who are currently jobless. DC and Washington's data also allow analysts to distinguish between leavers who never worked since exit and those who have worked but are currently jobless; however, the data show only a small difference in the average incomes of these two groups of jobless leavers.30

Table V.3:
Monthly Income of Single-Parent Welfare Leavers By Employment Status: Survey Findings

State/ Study

Employment Status
All Leavers ($) Currently Employed ($) Not Currently Employed ($) Never Worked Since Exit ($)

Arizona1,2

Mean

1,361 1,727 892 n.a.

Median

1,195 1,400 720 n.a.

District of Columbia3

Mean

1,091 1,353 675 647

Median

800 1,102 500 547

Washington4

Mean

1,227 1,462 870 884

Median

1,000 1,200 576 601

1Data calculated from public use data file.
2Arizona reports income including food stamps; we present an adjusted version of income, reducing reported income by 7% because 7% of the average family income of welfare leavers in Arizona comes from food stamps.
3Income data reported for all cases; not just single-parents.
4Figures based on calculations of public use data files differ slightly from those in published reports.
Note: All data calculated from public use data file.
Source: See Appendix B for a complete listing of the leavers studies referenced.