Participation rates and duration of participation, as well as whether participation took place while sample members were on or off welfare, determined both overall costs and the proportion of costs paid for by the welfare department. For example, post-secondary education unit costs were similar in the Atlanta and Grand Rapids HCD programs, but participation in both in-program and out-of-program (that is, self-initiated) activities was much greater in Grand Rapids, resulting in a total gross cost for post-secondary education that was nearly four times as high as that for Atlanta. As a result, the Grand Rapids HCD program incurred the highest in-program costs (column 3) and total costs (column 6). However, the proportion of these costs paid by the welfare department was lower in the Grand Rapids programs than in the other programs (column 1 divided by column 6): These programs had more participation in higher-cost activities such as education and training that was leveraged with fewer dollars by the welfare department.
Overall, higher costs were associated with higher rates of participation in education and training activities. Therefore, employment-focused programs might be expected to have lower total gross costs than education-focused programs. However, the gross costs of the Grand Rapids LFA and Portland programs were among the highest in this evaluation because sample members in these programs participated in education and training activities at high rates, much of it self-initiated. As a result, on average, employment-focused programs were slightly more expensive than education-focused ones.
The average gross cost was higher than costs found in other MDRC evaluations of welfare-to-work programs. On average, total gross costs of the NEWWS programs were similar to those found in other high-cost programs, including the Alameda and Los Angeles GAIN programs operated in the late 1980s and early 1990s, which provided extensive education and training services. The average cost per sample member across all NEWWS programs was $7,599, compared with $7,763 in Alameda and $7,123 in Los Angeles (all in 1999 dollars).(8) The higher costs in NEWWS programs (Atlanta and Grand Rapids HCD, Grand Rapids LFA, and Portland) are likely due to higher participation overall, and particularly in high-cost activities such as post-secondary education and vocational training.