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Since the passage of federal welfare reform in 1996, policy makers have been concerned about the well-being of families that have left welfare as well as those who have remained on the caseload. This report synthesizes the most up-to-date research about what is known about the composition of the TANF caseload and the status of TANF leavers, and how this has changed over time. This synthesis is supplemented by tabulations of data from the NSAF, SIPP and CPS on the demographics, economic situation, and barriers to work of current and former TANF recipients over time.
The 1996 Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) made major changes to the nation’s cash assistance policy for low-income families ("welfare"), replacing the Aid to Families with Dependent Children (AFDC) program with the Temporary Assistance for Needy Families (TANF) program. The new program has a stronger emphasis on work and has time-limited federal benefits. Between 1996 and 2003, welfare caseloads declined by more than 50 percent, although they had begun to fall in 1994, prior to federal welfare reform. Although this decline suggested that welfare reform was working, it also raised questions among policymakers, program administrators, advocates, and the public. These questions include whether the characteristics of the caseload were changing, whether families that left welfare were better off than when they were on welfare, and whether former recipients were making progress in the labor market.
The purpose of this report is to summarize what is know about these issues from existing literature and to update this knowledge with original analyses using more recent data. The key questions addressed in the report are:
- How do the characteristics of the TANF caseload compare with the AFDC/TANF characteristics 5 and 10 years ago? In particular, is the caseload more or less disadvantaged than in the past, especially with respect to their employability?
- What are the characteristics and outcomes for families that recently left the TANF rolls compared with families on TANF, and compared with families that left the TANF rolls 5 and 10 years ago? Have TANF leavers become more or less disadvantaged? Are families better off after leaving the TANF than when they were on the welfare rolls?
The report addresses these broad questions through a synthesis of available research. While there is a large literature examining the imparts of welfare reform, a more limited set of research provides descriptive statistics addressing the two key questions above, and much of this research is not based on nationally representative data but on data for specific geographic areas. In addition, most of the existing research focuses on the early period just after welfare reform (generally the mid-to late 1990) both as a response to the intense interest in understanding the early impacts of welfare reform and because of the limited availability of new data sources to study the later time periods. For this reason, we supplement our review of the literature with new descriptive analyses of TANF recipients ("stayers") and former recipients ("leavers") using three nationally representative data sets, the National Survey of Americas Families (NSAF), the Survey of income and Program Participation (SIPP), and the Current Population Survey (CPS). This approach allows us to provide information about both the early postreform period and the more recent postreform period, including data through 2005.
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