National Evaluation of the Welfare-to-Work Grants Program: Final Report. Poverty Rates

09/01/2004

Most WtW enrollees were living in poverty two years after program entry. At least half of enrollees in every study site had household incomes that were below the federal poverty threshold (Exhibit V.8). More than two-thirds of enrollees in Boston, Chicago, Ft. Worth, Nashville, Philadelphia, Phoenix, West Virginia, and Yakima were in poverty at the two-year follow-up point. As a point of comparison, Loprest (2001) reports that in 1999, 52 percent of families nationwide that had left TANF in the previous two years were living in poverty.(60) In six of the WtW study sites, most enrollees were living in severe poverty, with household incomes below 50 percent of the federal poverty threshold. Rates of poverty and severe poverty, like mean household income, were essentially unchanged from the end of the first year after program entry to the end of the second (Appendix Exhibit B.20). These findings are based on a measure of income that does not include food stamps, the earned-income tax credit (EITC), income taxes, or payroll taxes.(61)

The incidence of poverty was much lower for enrollees who were employed at the end of the second year following program entry than those who were not.(62)Exhibit V.9 shows that the poverty rate was lower for employed enrollees in every study site by between 16 percentage points (West Virginia) and 43 percentage points (Baltimore County). However, even employed enrollees had high poverty rates; between one-half and three-fourths of the enrollees who were employed two years after entering WtW were living in poverty in all of the study sites except Baltimore County and Milwaukee, where about four in ten employed enrollees were in poverty. High poverty rates among employed enrollees reflect a combination of low wages and instability in employment during the month for which household income was measured.(63)

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