With passage of the new welfare law, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996 (P.L. 104-193), the present welfare policy environment differs from that under the Family Support Act in a number of important respects (see Zaslow, Tout, Smith and Moore, 1998). For example, the 1996 law ends the entitlement to cash assistance (the AFDC program) and, instead, requires that recipients be employed within two years of applying for temporary cash assistance (now called, Temporary Assistance for Needy Families, or TANF). A certain percentage of the caseload is expected to work or be in work-related activities, with the percentage increasing from 25 percent of all families in 1997 to 50 percent in 2002. States face penalties if they do not meet these participation goals. The work requirement can be fulfilled through employment (either subsidized or unsubsidized), on-the-job training, or community service. Vocational training can address the work requirement for up to 12 months, while job search activities can fulfill the requirement for up to 6 weeks. Participation in school can fulfill the work requirement only for recipients under age 19.
Under the new law, there is a total lifetime limit of five years for the receipt of assistance through federal funds. Whereas the Family Support Act required mothers of children three and over to participate in work-related activities (with a state option to lower the age to 12 months), the new law lowered the age for all states to 12 months (or younger, if a state chooses). While under the Family Support Act, mothers were exempt from participation in welfare-to-work activities if they were needed in the home to care for a sick or incapacitated family member (including a child), there is no such explicit exemption under PRWORA. While PRWORA strengthens the requirements to work, at the same time there are also greater supports for work, with almost all states now treating earnings and assets more generously, and significantly more federal funds available for child care.
Both the welfare-to-work approaches under JOBS and the new welfare law mandated participation in welfare-to-work activities, and both sought clients' employment as the ultimate goal. However, the time-limited assistance of the new welfare law is intended to serve as an added incentive for clients to seek employment quickly and to engage in employment-preparation activities only inasmuch as they better prepare clients for immediate employment. Moreover, states face major financial penalties if they do not meet mandated participation rates, which is likely to result in a program focus on employment and limited work-related activities, rather than on longer-term education and training.
If policy makers are seeking to build a body of knowledge about how a range of welfare policies affect families and children -- in terms of both economic impacts as well as impacts on family functioning and child development -- then the JOBS labor force attachment and human capital strategies remain distinctive approaches that will provide an important benchmark against which to compare new policies and programs. Moreover, the HCD and LFA strategies remain viable approaches under TANF for many states seeking ways to foster the transition from welfare to work. New welfare-to-work approaches will need to be assessed not only in terms of initial transitions into employment and reductions in welfare caseloads, but also in terms of the stability of employment over time, longer-term impacts on family income, the likelihood of resuming the receipt of public assistance, and outcomes for children and families. If outcomes fall short of current expectations (e.g., if the employment that recipients move into lacks stability, if many resume the receipt of assistance or reach time limits, if total family income still places families below the poverty line), then it is possible that policy makers will revisit the approaches of the JOBS Program, particularly if the National Evaluation of Welfare-to-Work Strategies provides support for the view that one or both of the JOBS approaches lead to positive outcomes over time. Just as the economic record of the labor force attachment and human capital development approaches implemented under the JOBS Program will remain important in assessing the economic impacts of the new policy, so too will the record of impacts on family functioning and child outcomes remain important in understanding the non-economic impacts of the new law.