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Abstract
This paper assesses the role of work support programs (specifically, food stamps and Medicaid) and other factors in reducing welfare reentry and promoting stable employment among women exiting the TANF program. Using data from the 1996 and 2001 panels of the Survey of Income and Program Participation, the paper finds that welfare leavers who use food stamps as a transitional support when they leave TANF are less likely to return to TANF and more likely to be stably employed (for the year after exit) than women who do not receive food stamps when they exit welfare.
Introduction
Over the past decade, millions of families have left welfare for work, and millions more have toiled in low-paying jobs struggling to stay off welfare. Studies show that about one-quarter of the women heading families that leave welfare for work end up returning to welfare within a year of exit, and every year some families enter welfare for the first time (Acs and Loprest 2004). “Work support” programs targeted at welfare leavers and low-income working families seek to increase the economic security of working families and help them stay off welfare. These programs include food stamps, health insurance assistance (Medicaid and SCHIP), child care, the earned income tax credit (EITC), and others.
This paper uses data from the 1996 and 2001 panels of the Survey of Income and Program Participation (SIPP) to assess how many women leaving welfare use these worksupport programs and whether they effectively keep families off welfare. It also assesses how strongly job-specific factors, individual and family characteristics (e.g., age, education, family size), and state welfare policies influence welfare reentry. Gaining a better understanding of what helps keep families off welfare and whether these factors have changed since the early years of welfare reform will help policymakers better design and target programs aimed at supporting work.
Food stamps can help women make lasting exits from welfare and remain stably employed. Specifically, woman who use food stamps as a transitional benefit—that is, they receive food stamps when they exit TANF but subsequently exit the Food Stamp program—are less likely to return to welfare than women who do not receive food stamps when they exit TANF. Being enrolled in Medicaid in the month of exit is not associated with lower rates of Assessing 2 the New Federalism return to welfare. In addition, women with high school degrees, whites, those without worklimiting disabilities, and those living in states with lower TANF benefits are also less likely to return to TANF than other women.
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Disclaimer: 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.
