Leavers, Stayers, and Cyclers An Analysis of the Welfare Caseload. Summary


Between 1994 and 1999, the welfare caseload fell by almost 50 percent. In other words, about two million fewer families were receiving welfare in 1999 than five years earlier. To some observers, this trend is evidence that welfare reform has been a success. To others, it raises a host of new questions and concerns and suggests that the 1996 law was only the first step in the process of reforming welfare. For example, how are the families who have left welfare doing? Are most of them working and earning enough to lift themselves above poverty? And who are the families who are still left on the welfare rolls? Do they face especially severe circumstances that may prevent them from going to work?

This report looks at the changing nature of the caseload by examining the characteristics and circumstances of three groups: people who leave welfare and stay off for at least a year (leavers), people who stay on welfare persistently (stayers), and people who cycle on and off the rolls (cyclers). The report uses a unique data set consisting of over 30,000 people who were targeted for a variety of welfare-to-work programs over the past decade. The programs were each evaluated using a random assignment design, in which some families were assigned into the new program being tested and others were assigned into the existing welfare system in the state at the time of the evaluation. The programs include three key components—mandatory participation in employment or education activities, enhanced financial incentives, and time limits—used alone and in combination. Together, they cover the range of policies that states now have adopted as part of their new welfare programs. Data from these welfare-to-work programs make it possible to track the employment, welfare, and economic status of families for up to five years after they entered the evaluation. By dividing the caseload into stayers, leavers, and cyclers, the following key questions can be addressed: 

  • Who is leaving welfare long term? What potential employment barriers do welfare leavers face, and how are they faring economically? How do their circumstances differ from those of people who stay on welfare persistently and of people who cycle on and off welfare? 
  • How many families leave welfare without work? Who are they, and what potential employment barriers do they face? How are they faring relative to families who are working when they leave welfare? 
  • What effects have welfare-to-work programs had on the caseload? Who remains on welfare persistently, despite being subject to a welfare-to-work program? Do they face more barriers to employment than people who stay under the traditional AFDC system?
Understanding the circumstances of families who leave welfare long term is important to designing effective programs for welfare recipients and for low-income families in general. If many who do work are still poor, for example, more effort might be devoted to post-employment services that help low-wage workers increase their earnings.It is equally important to find out about the families who stay on welfare. If many of the families receiving welfare today face severe employment barriers, then welfare policies that have been used in the past may not work for this new type of caseload. Finding new policies for the hard-to-employ may have also gained added urgency if welfare reform, by encouraging more and more families to leave welfare, has left a caseload that is even harder to employ than in the past. Examining the effects of several welfare-to-work programs on the composition of the caseload provides hints as to the effects of welfare reform more broadly. Finally, there has been little research on cyclers, or people who return to welfare intermittently but do not stay on it persistently. It is not clear, for example, whether cyclers face more dire economic circumstances than stayers and leavers or whether they possess fewer or more barriers to employment.  


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