Do Families on Welfare in the Post-TANF Era Differ From their Pre-TANF Counterparts?

Assessing the New Federalism Discussion Paper No. 01-03

Assessing the New Federalism is a multi-year Urban Institute project designed to analyze the devolution of responsibility for social programs from the federal government to the states. It focuses primarily on health care, income security, employment and training programs, and social services. Researchers monitor program changes and fiscal developments. Alan Weil is the project director. In collaboration with Child Trends, the project studies changes in family well-being. The project provides timely, nonpartisan information to inform public debate and to help state and local decisionmakers carry out their new responsibilities more effectively.

Key components of the project include a household survey, studies of policies in 13 states, and a database with information on all states and the District of Columbia. Publications and database are available free of charge on the Urban Institute's Web site: http://www.urban.org.

The project has received funding from The Annie E. Casey Foundation, the W.K. Kellogg Foundation, The Robert Wood Johnson Foundation, The Henry J. Kaiser Family Foundation, The Ford Foundation, The David and Lucile Packard Foundation, The John D. and Catherine T. MacArthur Foundation, the Charles Stewart Mott Foundation, The McKnight Foundation, The Commonwealth Fund, the Stuart Foundation, the Weingart Foundation, The Fund for New Jersey, The Lynde and Harry Bradley Foundation, the Joyce Foundation, and The Rockefeller Foundation.

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

Contents

Introduction

Data and Methods

Have the Demographic Characteristics of TANF Families Changed?

What Are the Work Characteristics of Adults Receiving TANF Benefits?
    Work Activity
    Barriers to Employment

Are Most of the Adults on TANF "Stayers"?
    Work Histories
    Barriers to Employment
    Welfare Stayers, 1997 and 1999

Summary and Implications for TANF Policy

Introduction

While the recent, dramatic exodus from welfare is well known, relatively little is known about those who continue to receive welfare. The number receiving cash assistance from the Temporary Assistance for Needy Families (TANF) program dropped from 4.1 to 2.4 million families over the three-year period ending December 1999. While the best studies provide somewhat different explanations of the causes of caseload decline, it seems safe to conclude that new policies combined with the exceptionally strong economy have substantially increased work among low-income single mothers and decreased their reliance on welfare.¹ The dramatic exodus from welfare has led many to question whether the TANF caseload is becoming increasingly disadvantaged. The concern is that the most able mothers left welfare for work, leaving behind a significantly more disadvantaged group.

We examine this question using data from two rounds of the National Survey of America's Families (NSAF). The NSAF is a nationally representative survey of nonelderly families in the United States. The first round was completed in 1997; the second in 1999. In both surveys we asked families about their current and recent welfare participation, their recent employment status, and potential barriers to employment.

Our results show some important changes in the characteristics of families on TANF between 1997 and 1999. For example, in 1999, African Americans made up a larger share of TANF families, more TANF recipients lived with an unmarried partner, and substantially more adult recipients were working. Furthermore, adults on TANF did not report significantly more barriers to work in 1999 than in 1997. While somewhat more recipients reported serious health problems, the increase was not statistically significant, and the incidence of nonhealth obstacles to work either remained unchanged or improved. Additionally, the share of the adults on TANF without recent work experience, often a significant deterrent to employment, decreased significantly.

This picture, however, masks important differences among adults on TANF. Adults who entered TANF for the first time, accounting for one-quarter of adults on welfare, had fewer barriers to work than those who had been on TANF more continuously. A larger share of the new entrants, for example, had completed high school and had recent work experience. In contrast, adults who had left TANF but cycled back on within a two-year period looked more like adults who had been on TANF continuously. The one exception was the presence of an infant in the family, indicating that childbirth may be one event that triggers a return to welfare. The patterns of time on welfare and barriers to work among the continuous TANF group in 1999 mirrored those found in the 1997 survey.

This paper begins by describing the data we use to portray the families on TANF. Then we examine the living arrangements and racial composition of families on welfare in 1997 and 1999. The remainder of the paper focuses on the characteristics of adults receiving benefits. We examine their current work activity and barriers to work and ask whether adults receiving assistance in 1999 were more disadvantaged than they were in 1997. We also examine these characteristics by the length of time adults reported receiving benefits to understand whether those who have been on TANF for a longer period of time differ from those with shorter welfare tenures. In the last section we summarize the results and their implications for policy.

See the PDF for complete report.

1. See Bell (2001) for a synthesis of key studies' findings.

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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