How Effective Are Different Welfare-to-Work Approaches? Five-Year Adult and Child Impacts for Eleven Programs. What Has Been Learned?

12/01/2001

Overall, the results suggest that these welfare-to-work programs, both education-focused and employment-focused, increased earnings and decreased welfare receipt for a wide range of subgroups. In particular, they suggest that the approach of the Family Support Act of 1988 was reasonably successful: The welfare-to-work programs did generally result in higher earnings for long-term welfare recipients.

On the other hand, for the least disadvantaged (those sample members who have a high school diploma, have recent work experience, and have little prior welfare history) none of the programs increased earnings significantly, and the programs as a whole were just as likely to increase earnings as to reduce them. This may reflect, again, the fact that the programs were forced by the provisions of the Family Support Act to concentrate resources on the most disadvantaged. Alternatively, it could be interpreted as evidence that concentrating services on the least disadvantaged is an inefficient use of resources. Perhaps more advanced training, training that builds on skills already in place, is needed for the least disadvantaged.

Impacts by subgroup bolster evidence from the full sample regarding the most successful programs and program approaches. LFA programs tended to have larger effects on earnings and welfare benefits for most subgroups, although differences were typically fairly small. The Portland program was the most effective for the broadest range of subgroups. Of the seven subgroups compared (not counting those by race and ethnicity), Portland had the largest effect on earnings for six of the subgroups. This may reflect the program's unique use of both job search and education as initial program activities, but it might also reflect the program's use of job development, its experience running job search programs, its willingness to exempt welfare recipients who were perceived to be the hardest-to-employ from welfare-to-work services, or the interaction of these features with the city's robust economy during this period.

Endnotes

1.  Michalopoulos and Schwartz, 2001.

2.  The number of programs that produced a larger effect for one group than for another follows a binomial distribution. Significance levels were determined using this distribution, under the hypothesis that the programs had equally large effects for all subgroups. For example, if welfare-to-work programs do not affect the earnings of long-term welfare recipients, then the chance that all 11 programs would have had higher earnings for long-term recipient program group members than for long-term recipient control group members is 0.1 percent. Likewise, the chance that 10 or more of the programs would have had higher earnings for long-term recipient program group members than for long-term recipient control group members is 1.17 percent, and the chance that 9 or more of the programs would have had higher earnings for long-term recipient program group members than for long-term recipient control group members is 6.54 percent.

3.  Michalopoulos and Berlin, 2001.

4.  Michalopoulos and Schwartz, 2001.

5.  Friedlander, 1988.

6.  For example, Eberts, 1997; and Rangarajan, Schochet, and Chu, 1998.

7.  Michalopoulos and Schwartz, 2001.

8.  A few sample members were not part of any of these three groups. Because only Oklahoma City and Riverside had more than a handful of these people, results for them are not shown in Table 7.4.

9.  Michalopoulos and Schwartz, 2001.