| Building an Employment Focused Welfare System |
| Implementation, Participation Costs, and Two-Year Impacts of the Portland (Oregon) Welfare-to-Work Program |
| ACF Office of Planning, Research & Evaluation |
| HHS Office of Assistant Secretary for Planning & Evaluation |
FOR IMMEDIATE RELEASE:
Tuesday, June 23, 1998
Contact: Michael Kharfen, (202) 401-9215
REPORTS EXAMINE SUCCESSFUL WELFARE-TO-WORK EFFORTS
HHS Secretary Donna E. Shalala today released two reports that
examine successful programs in five states and one city helping
welfare recipients move into jobs.
"As states and localities develop their own welfare-to-work
programs, they need to know how successful programs are achieving
results," Secretary Shalala said. The efforts outlined in
these reports are excellent examples of programs that work."
One of the studies, "Building
an Employment Focused Welfare System," prepared by the Urban Institute,
examines how welfare reform is being implemented by Indiana, Massachusetts,
Oregon, Virginia and Wisconsin -- five states that have experienced caseload
declines well above the national average.
The second report prepared by the Manpower Development Research
Corporation, "Implementation, Participation Costs, and Two-Year Impacts of the Portland (Oregon) Welfare-to-Work Program," looks
at Portland, Oregon's welfare-to-work program, which reduced welfare
expenditures by 17 percent over a two-year period, while increasing
recipients' earnings by 35 percent.
"I am encouraged that these programs report substantial numbers
of welfare parents working, and significantly in jobs paying more
than the minimum wage," said Olivia Golden, HHS Assistant
Secretary for Children and Families. "Moving from welfare
to work must mean opening new doors of opportunity for families."
The five-state study focuses specifically on experiences implementing
"Work First," the philosophy that most welfare recipients
are capable of obtaining employment, that any job is better than
no job and that the best way to succeed in the labor market is
to join it.
The five states studied in the Urban Institute report were already
restructuring their welfare systems to emphasize work when Congress
passed major federal welfare reform in 1996. That legislation
eliminated traditional open-ended cash assistance provided by
the Aid to Families with Dependent Children (AFDC) program and
the Job Opportunities and Basic Skills Training (JOBS)
program. Congress replaced these programs with the Temporary Assistance
for Needy Families program, which provides block grants to individual
states, and which requires work for welfare recipients.
"There has been a shift in welfare-to-work programs across
the country, from relying on providing education and training
as the major route to self-sufficiency, to programs which embrace
a Work First philosophy," said Pamela A. Holcomb of the Urban
Institute. "The point of this report is to show how states
are accomplishing this shift."
Typical practices, the researchers report, included (1) making
a job search the first and central activity, (2) limiting participation
in education and training, (3) imposing stricter participation
and work requirements, including greater use of unpaid work experience
(4) enforcing stiffer penalties for noncompliance and (5) placing
time limits on assistance.
While the Work First programs in all five states shared common
features, each state combined elements to create its own unique
version of welfare reform. For example:
- Virginia provided recipients with the greatest opportunity
to combine assistance with employment but also applied severe
penalties for non-cooperation;
- Both Virginia and Massachusetts imposed work requirements
sooner than the other states and relied more extensively on community
service programs to engage recipients in some form of work;
- Oregon developed the most successful program for creating
subsidized employment opportunities for welfare recipients.
By tracking a sample of recipients over a one year period, the
five-state study found that 31-44 percent of the participants
at the end of the year were still receiving cash assistance or
back on welfare, with or without a job.
"The Portland results provide valuable lessons on how to
not only get more people working, but also get them better jobs,
and on how to succeed with those typically considered hard to
place in jobs," said Gayle Hamilton of the MDRC. "The
program emphasized getting a job quickly, but also used some education
and training as tools to get there."
Portland, Oregon's efforts have been among the most effective
among large-scale mandatory programs, according to the report
prepared by the Manpower Demonstration Research Corporation. By
the end of the study period, just 41 percent of program group
members were receiving welfare, compared to 53 percent of control
group members. The proportion of people working at full-time jobs
increased by 13 percent, and the proportion with employer-provided
health benefits increased by 10 percent.
The Portland program used a mixed-services strategy: most people
participated in job search, but many also participated in short-term
education, vocational training, work experience, and life skills
training. Failure to participate resulted in welfare grant reductions.
One important feature of the Portland program is that it increased
job quality. Participants were encouraged to look for and take
"good" jobs--full-time jobs, paying more than the minimum
wage, with benefits and potential for advancement.
The studies suggest that states will need to adopt a greater range
and mix of services and strategies to help the least employable
welfare recipients, Assistant Secretary Golden said.
###
Note: All HHS press releases, fact sheets and other press materials are
available at http://www.hhs.gov/news.
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