Long-term employment and earnings among low-income families with children

Self-support through employment has become much more important for low-income mothers and welfare recipients as a result of welfare reform and decline of welfare caseloads. This study used the 2004 longitudinal panels of the Survey of Income and Program Participation (SIPP) to examine longitudinal patterns and trajectories of employment and earnings and to identify factors associated with long-term employment and earnings success among low-income mothers. The results indicate that despite the high proportion of low-income mothers employed, a substantial number were unable to sustain employment and had low earnings. Only 37% of low-income mothers experienced earnings success. Moreover, nearly half of the sample who had successful employment trajectories experienced stagnant or decreasing earnings. Results highlight the importance of considering the level, trend, and stability of employment and earnings in categorizing employment and earnings success. The factors associated with both long-term employment and earnings success included education, work disability, earnings of other adults in the family, homeownership, and state unemployment rates. Results also revealed some differences in factors that determined these two outcomes. The findings point to the importance of advocating for social policies that provide additional income and employment supports for low-income families with children.     

Locational effects on AFDC exits: Examining local labor markets

Recent welfare reform limits welfare recipients to a maximum of five years of cash assistance. This policy change raises the question of whether it is reasonable to expect welfare recipients to be able to leave the rolls within a five year period, regardless of the economic conditions of the state or area in which they live. This article pursues this issue by examining the effects of economic conditions and residential location on a welfare recipient’s likelihood of leaving welfare over time. The analysis uses linked files from the Panel Study of Income Dynamics, the 1970 and 1980 U.S. Censuses, and County and City Data Book data from 1972 to 1994 to determine AFDC exit probabilities. The results indicate that being low-skilled and living within one of the largest U.S. cities dramatically decreases the likelihood of exit from AFDC via increased earnings. The results also show that the job loss within cities has a significant negative impact on AFDC exit probabilities for marriage, increased earnings and all exits for high school dropouts and African American AFDC recipients. However, including city employment variables did not decrease the negative effects of living within large northern cities for earnings exits. These results indicate that negative economic conditions and poor transportation within cities impede low-skilled AFDC recipients from increasing earnings and leaving welfare.     

Using cluster analysis in program evaluation

The conventional way to measure program impacts is to compute the average treatment effect; that is, the difference between a treatment group that received some intervention and a control group that did not. Recently, scholars have recognized that looking only at the average treatment effect may obscure impacts that accrue to subgroups. In an effort to inform subgroup analysis research, this article explains the challenge of treatment group heterogeneity. It then proposes using cluster analysis to identify otherwise difficult-to-identify subgroups within evaluation data. The approach maintains the integrity of the experimental evaluation design, thereby producing unbiased estimates of program impacts by subgroup. This method is applied to data from the evaluation of New York State's Child Assistance Program, a reform that intended to increase work and earnings among welfare recipients. The article interprets the substantive findings and then addresses the advantages and disadvantages of the proposed method.     

Temporary employment experiences of women on welfare

Females with recent participation in public welfare are a disproportionate and growing share of temporary help services firm employees. Research documenting low earnings, frequent job transitions, and low benefit rates among temporary workers has raised concerns that welfare recipients taking these jobs might have poorer labor market outcomes than those entering permanent positions. My findings show that a majority of welfare recipients working in temporary jobs were satisfied with their pay and working conditions and did not earn much less than those in other jobs. They did report, however, high levels of dissatisfaction with the lack of employment benefits received, and their annual earnings were still very low, reflecting chronic job instability that is endemic to the welfare population.     

LONG‐RUN EFFECTS OF YOUTH TRAINING PROGRAMS: EXPERIMENTAL EVIDENCE FROM ARGENTINA

We study the effect of a job training program for low‐income youth in Cordoba, Argentina. The program included life‐skills and vocational training, as well as internships with private sector employers. Participants were allocated by means of a public lottery. We rely on administrative data on formal employment, employment spells, and earnings, to establish the effects of the program in the short term (18 months), but also—exceptionally for programs of this type in Latin America and in developing countries in general—in the medium term (33 months) and in the long term (48 months). The results indicate sizable gains of about 8 percentage points in formal employment in the short term (about 32% higher than the control group), although these effects dissipate in the medium and in the long term. Contrary to previous results for similar programs in the region, the effects are substantially larger for men, although they also seem to fade in the long run. Program participants also exhibit earnings about 40% higher than those in the control group, and an analysis of bounds indicates that these gains result from both higher employment levels and higher wages. The detailed administrative records also allow us to shed some light on the possible mechanisms underlying these effects. A dynamic analysis of employment transitions indicates that the program operated through an increase in the persistence of employment rather than from more frequent entries into employment. The earnings effect and the higher persistence of employment suggest that the program was successful in increasing the human capital of participants, although the transient nature of these results may also reflect better matches from a program‐induced increase in informal contacts or formal intermediation. (JEL J08, J24, J68, O15)     

Transition From Welfare to Work: Self-Esteem and Self-Efficacy Influence on the Employment Outcome of African American Women

Empirical strength-based research focusing exclusively on African American female welfare recipients and employment outcome is limited. This study examined whether self-esteem and self-efficacy influenced the employment of African American female welfare recipients. Findings indicated that recipients entered the job-readiness program with a significantly high level of self-esteem. Their self-efficacy, however, was positively influenced by the job-readiness program, and once it was completed, the recipient's self-efficacy decreased.     

AsianWORKs

ABSTRACT

Achieving economic self-sufficiency through employment is the ultimate goal of recent changes to the welfare program. The Asian American and Pacific Islander (AAPI) population is most vulnerable to failing in this goal because of language difficulty, low education levels and lack of job skills in the labor market. Many AAPI immigrants, and Southeast Asian Americans in particular, suffer from adjustment and mental health problems due to their experiences as refugees. These are but a few of the obstacles for AAPI welfare recipients to become self-sufficient, making them one of the most “hard-to-serve” populations. The goal of self-sufficiency through employment can be reached if culturally appropriate and adequate support services are provided to meet the unique needs of the population. Few programs, however, are targeted at AAPIs. Using key-informant interviews and the case material review method, this article highlights the difficulties of AAPI welfare recipients and describes a unique program serving the Southeast Asian American, particularly the Cambodian, population. The article focuses on the program components of outreach and engagement, day socialization and job readiness, and family support services, and it discusses improvement to service access and lessons learned for the practice of cultural competence.     

A longitudinal evaluation of government-sponsored job skills training and basic employment services among U.S. baby boomers with economic disadvantages

Job skills training is a cost-effective strategy for improving employment among individuals who have low income and employment barriers, but few U.S. government-sponsored employment program participants have received such training. To better understand long-term gains from job skills training, this study compared employment and earnings trajectories between program participants who received job skills training and those who received basic services only. Using data from the National Longitudinal Survey of Youth 1979, we estimated 33-year employment and earnings trajectories among U.S. baby-boomer cohorts while accounting for baseline group heterogeneity using inverse propensity score weighting. We found increases in employment rates over the life course, especially among Black women. Job skills training also increased earnings by up to 69.6 % compared to basic services only. Despite the long-term gains in employment and earnings, job skills training participation is not sufficient to address gender as well as racial and ethnic gaps in full-time employment. Findings reinforce the importance of incorporating job skills training as an essential service element of government-sponsored employment programs to improve long-term labor market outcomes among Americans with economic disadvantages.     

Employment and the Risk of Domestic Abuse Among Low‐Income Women

This paper uses data from 2 randomized evaluations of welfare‐to‐work programs—the Minnesota Family Investment Program and the National Evaluation of Welfare‐to‐Work Strategies—to estimate the effect of employment on domestic abuse among low‐income single mothers. Unique to our analysis is the application of a 2‐stage least squares method, in which random assignment enables us to control for omitted characteristics that might otherwise confound the association between employment and domestic abuse. We find that increased maternal employment decreases subsequent reports of domestic abuse in both studies. In the Minnesota Family Investment Program—a program with an enhanced income disregard that allowed welfare mothers to keep a portion of their welfare income as earnings rose—an increase in household incomes appears to have contributed to reductions in reports of domestic abuse.     

Assessing Welfare Reform, Over a Decade Later

It has now been over a decade since the passage of the 1996 welfare reform legislation ( Personal Responsibility and Work Opportunity Reconciliation Act ). In this paper, we synthesize the expansive literature on how welfare reform has affected poor families and nonprofit agencies that serve them. In particular, we explore state variation in welfare policies and the dramatic declines in welfare caseloads. We also investigate the employment, earnings, and levels of material hardships among current and former welfare recipients. Moreover, we examine what we know about welfare reform's impact on marriage, nonmarital childbearing, and child well-being. Lastly, we report on how welfare reform has affected nonprofit agencies that serve poor families. We are left with a complex account of the impacts of welfare reform that reveals both positive developments in a number of areas and a great deal of remaining challenges.     

Social insurance and children: The relationship between Social Security,economic well-being,and family context among child recipients

The relationship between social insurance, which provides families protection against certain risks, and child economic security is understudied. Using the 2004 Survey of Income and Program Participation (SIPP) matched to Social Security Administration benefit records, this article investigates the economic welfare effects of the child component of the US Social Security program. We examine how the poverty rate of child beneficiaries would change, absent Social Security income, and how heavily the family incomes of these children rely on it, by family characteristics. Our findings reveal that Social Security plays an important role in mitigating economic insecurity among children deprived of a wage-earning parent through disability, death, or retirement. Family structure, earnings, and employment status are identified as key factors moderating the effect of Social Security on child recipients’ financial circumstance.     

Employment Among Current and Former Welfare Recipients: A Literature Review

ABSTRACT

The primary goal of welfare reform is to move recipients from welfare to work. Several factors influence the employment of welfare recipients. The purpose of this content analysis is to offer a comprehensive understanding of employment characteristics and important personal, family, and employment characteristics that either promote or deter employment among current and former welfare recipients. Social workers need a comprehensive understanding of these factors in order to design policy and social work interventions. This article is a content analysis of the results of empirical research studies. Implications and recommendations are offered based on the review of empirical research on current and former welfare recipients.     

DO REEMPLOYMENT PROGRAMS FOR THE UNEMPLOYED WORK FOR YOUTH? EVIDENCE FROM THE GREAT RECESSION IN THE UNITED STATES

We present experimental evidence on the effects of four U.S. reemployment programs for youth unemployment insurance (UI) recipients during the Great Recession. The three programs that emphasized monitoring and service referrals reduced UI receipt but had minimal effects on employment and earnings; these programs mainly induced the early exit of participants. The fourth program, which combined mandatory job counseling with monitoring, caused the largest reductions in UI receipt and clearly increased employment and earnings. Both early participant exits and effective job counseling underlie these impacts. We conclude that policymakers should require job counseling for youth UI recipients during recessions. (JEL J0, J6, H4)     

Self-Employment as a Social and Economic Development Intervention for Recipients of AFDC

Summary

This paper reports findings from program evaluations of two demonstrations designed to (1) test self-employment as a social and economic development strategy for recipients of AFDC, and (2) identify policy barriers to improving the economic well-being of this population. The authors collected data through interviews with program participants and program operators and used secondary data contained in operators' management information systems and state Department of Human Services electronic files. Program results showed that self-employment is a viable social and economic development strategy for self-selected welfare recipients who receive business training and assistance in locating operating capital. The paper discusses implications for social work practice, education, and research.     

Assessing readiness to work from a stages of change perspective: implications for return to work

The Lam Assessment on Stages of Employment Readiness (LASER) was developed to assess welfare recipients' employment readiness. The LASER consists of 14 items corresponding to Prochaska's stages of change model (Prochaska, DiClemente and Norcross, 1992). A sample of 149 welfare recipients from a work training program participated in the study. The Confirmatory Factor Analysis (CFA) supported the three factors structure corresponding to Prochaska's Pre-Contemplation, Contemplation, and Action stages. A cluster analysis classified the sample into three groups according to their LASER scores. A six months follow-up on employment outcomes showed that those who were in Pre-contemplation stage had the poorest employment outcome (25%), those who were in the Action stage had the best outcome (56%) and those in the Contemplation stage were in between (38%). Implications for work rehabilitation and treatment matching were discussed.     

Social Democratic Programs: What Is Worth Modeling (for the United States)

This article argues that the United States could improve social welfare outcomes by adopting effective and efficient elements from nations that excel in social welfare areas of employment, education, health care and income support. Using secondary data for comparison the article explores four foreign model programs that are worth modeling for the United States, which include employment in Norway, education in Finland, and health care and income support in Sweden. Each program is framed within its national context and is qualitatively described and linked to three essential social democratic values: universalism, equality and comprehensiveness     

What Makes an Entrepreneur and Does it Pay? Native Men,Turks, and Other Migrants in Germany

This paper focuses on the entrepreneurial endeavours of immigrants' and natives in Germany, concentrating on Turks, Germany's largest immigrant group and one under‐studied in the literature. Self‐employed Turks in Germany represent about 70 per cent of all Turkish entrepreneurs in the European Union. We use data from the German Socio‐economic Panel to study patterns of self‐employment. First, we identify the characteristics of the self‐employed individuals and understand their underlying drive into self‐employment. Next we investigate how immigrant entrepreneurs fare in the labour market and compare their earnings to those of the natives. It is important for decision makers to understand entrepreneurial patterns so that they can shape policy that better fosters entrepreneurial activities. This paper presents several findings that can inform better policymaking. First, our investigation indicates that education is not decisive in determining whether one will choose self‐employment over salaried work nor in explaining earnings. The estimated age‐earnings profiles are the same for natives and immigrants, while the proclivity to become self‐employed is concave with respect to age for both groups. Immigrants' start with a higher probability to work than natives but have a slower increase in the self‐employment probabilities thereafter. The earnings of self‐employed immigrants' are higher initially, but their earnings path crosses eventually that of the natives. Second, we find some suggestion of ethnic entrepreneurial spirit. Turks are 70 per cent more likely to be self‐employed than any other immigrant group, although they do not necessarily earn more. These patterns should be further explored.     

Path Analysis of Welfare Use: Depression as a Mediating Factor

Path analysis was conducted to determine causal effects of life circumstances on depression and effects of these measures on employment and welfare use. Data were from the Welfare and Self-Sufficiency Survey conducted in a metropolitan county of Kentucky. Direct effects indicate that economic hardships and adverse life events increase depression scores and depression reduces earnings and increases welfare use. Indirect effects of economic hardships and adverse life events, through the mediating effects of depression, reinforce depression??s effects on employment and welfare use. The data include measures of life circumstances and depression scores of low-income women; thereby, permitting a path model that uniquely contributes to knowledge regarding the effects of life circumstances and depression on TANF-eligible women??s employment and welfare use.     

Welfare Reform on American Indian Reservations

Abstract

In this article we document trends in welfare caseloads and some initial experiences of service providers and welfare recipients on reservations within Arizona under Temporary Assistance for Needy Families (TANF). We document the issues and concerns of state and tribal service providers as they implement the legislation on reservations that are often geographically isolated and which lack infrastructure, jobs, childcare and transportation. We also record experiences of women with children on reservations with the 1996 federal welfare legislation. These families experience similar barriers when trying to move from welfare to work as do their counterparts across the country; however, these barriers are magnified on reservations. The welfare recipients' barriers include: a shortage of employment opportunities on reservations; a lack of transportation and childcare facilities; low levels of education and job experience; and, individual and family problems. Poor families in Indian communities face additional barriers to employment because of their geographic isolation, lack of access to basic necessities (like telephones), as well as stereotypes and discrimination by employers due to ethnicity or personal/family histories.     

The effect of immigration on the earnings of native-born workers: Evidence from Australia

No consensus has been reached by previous studies on the impact of immigration on the earnings of natives. Using data from the Australia's 2001 Census of Population and Housing an individual-level earnings function is estimated by including the fraction of immigrants in a given skill group relative to total employment in that skill group as one of the independent variables. Using employees’ occupation and level of education as proxies for skill, the results indicate that generally immigrants have a significant positive effect on earnings of natives. The overall findings suggest that the increase in supply of labour due to immigration is offset by higher demand for labour and hence positive effect on native earnings.