Moving People from Welfare to Work. Lessons from the National Evaluation of Welfare-to-Work Strategies.. Relative Impacts: Which types of programs are generally most effective?

07/01/2002

  • Employment-focused programs generally had larger effects on employment and earnings than did education-focused programs.

Figure 6 presents all 11 NEWWS programs' impacts on earnings, that is, the differences between the program and control groups' earnings in each site. As shown, three of the four employment-focused programs produced larger gains in earnings over the five years than did all seven education-focused programs.

The LFA programs' impacts on five-year earnings ranged from about $1,500 to $2,500. Their impacts on the number of quarters people were employed ranged from 0.7 to 1.1 (out of the 20 quarters in the study period). As is evident in the figure, the employment-focused program in Portland produced much larger effects, with an earnings impact of about $5,000 and an increase in quarters employed of 1.6. Overall, the education-focused programs' effects were smaller. Neither of the two programs with low enforcement of the participation mandate significantly raised employment, while the other five education-focused programs increased earnings by about $800 to about $2,000 and the number of quarters employed by 0.3 to 0.8.

Given the large number of programs examined in NEWWS and the diversity of the populations they served, the features of their implementation, and the labor markets in which they operated, these results strongly indicate that employment-focused programs are more effective than education-focused programs at increasing employment and earnings.


Figure 6.
Earnings over Five Years, by Program:
Employment-Focused Programs Generally Increased Earnings More than Education-Focused Programs

Earnings over Five Years, by Program: Employment-Focused Programs Generally Increased Earnings More than Education-Focused Programs.

SOURCE: Hamilton et al.,,2001

NOTES: The Riverside LFA program results include both graudates and nongraduates.
Asterisks(*) denote statistical signficance levels: * = 10 percent; ** = 5 percent; *** = 1 percent.


  • Welfare and food stamp payment reductions were not consistently larger in the employment-focused programs than in the education-focused programs.

Figure 7 presents all 11 NEWWS programs' impacts on average welfare and food stamp payments. The savings were generally larger for the programs that had larger effects on earnings, but they varied for other reasons as well. For instance, as would be expected, welfare payments decreased more in sites where grant levels were relatively high than in sites where grant levels were relatively low. In addition, the programs decreased payments of welfare benefits more in sites that strictly enforced program participation mandates than in sites that did not.


Figure 7.
Impacts on Welfare and Food Stamp Payments over Five Years, by Program:
Welfare and Food Stamp Payment Reductions Were not Consistantly Larger in Employment-Focused Programs than in Education-Focused Programs

Impacts on Welfare and Food Stamp Payments over Five Years, by Program: Welfare and Food Stamp Payment Reductions Were not Consistantly Larger in Employment-Focused Programs than in Education-Focused Programs.

SOURCE:  Hamilton et al.,,2001

NOTES: The Riverside LFA program results include both graudates and nongraduates.
Asterisks(*) denote statistical signficance levels: * = 10 percent; ** = 5 percent; *** = 1 percent.
Double daggers(‡) denote statistical significance levels for food stamp payments: ‡ = 10 percent; ‡‡ = 5 percent; ‡‡‡ 1 percent.;