Journal Issue: Welfare to Work Volume 7 Number 1 Spring 1997
Employment and Job Stability Among AFDC Recipients
A look at employment patterns among AFDC recipients shows, first of all, that contrary to the impression conveyed by the term "welfare dependency," relatively few welfare recipients depend totally on AFDC. A 1995 study by the Institute for Women's Policy Research found that, during a two-year period, 43% of a sample of single mothers who received AFDC at some point combined welfare with earnings, either receiving both simultaneously or cycling back and forth between work and welfare.1 Making ends meet on welfare and food stamps is extremely difficult for families. In one study, more than one-third of welfare mothers interviewed said their total benefits did not cover their basic housing and food costs.2 On average, their benefits were reportedly a startling $311 less than their monthly household expenses—a shortfall of 35%. The women filled this gap partly by working and partly by contributions from family, friends, male partners, and absent fathers.
The fact that employment is a common experience for many single mothers who receive AFDC benefits is not revealed by administrative data describing the welfare caseload at any given time. In 1992, for example, administrative data showed that only 7% of mothers on AFDC were working, in contrast to the estimated 43% reported above.3 Several factors contribute to the extreme difference between these estimates. First, administrative records capture a single point in time, identifying only those who simultaneously work and receive welfare. Current welfare rules make this very difficult: In an average state, working just 20 hours a week for $5 per hour makes a recipient ineligible for AFDC benefits after just four months. Most employment occurs before women begin receiving benefits or after they leave the welfare rolls, and it is discovered only in studies that follow women over the course of a year or more. Second, longer-term AFDC recipients dominate the welfare rolls at any given time; cross-sectional estimates thus largely reflect the experiences of recipients with the most limited employment prospects.4 Finally, not all employment is reported to the welfare department, especially if the employment is intermittent or occurs in the underground economy.2
Many women who leave welfare do so to work, and they often leave rather quickly. Current estimates of the fraction of welfare exits that result from employment (rather than from marriage, for instance) vary from about half 5,6 to two-thirds,7 depending on the sample and definitions used. The National Longitudinal Survey of Youth showed that 25% of young women on welfare left the AFDC rolls for employment within a year,5 and 41% by the end of five years. Relying solely on agency records can yield a very different estimate of employment exits; in one case, agency records indicated that 4% of welfare exits were due to employment, but surveys estimated the rate at 54%.8,9 Recipients often fail to report that they are working when they request termination of their benefits, and agency staff sometimes do not properly record the reason that is given. As a result, the frequency with which AFDC recipients leave welfare for work can be substantially underestimated.
The jobs welfare recipients find, however, generally do not last very long, and returns to welfare are common. Studies have found that between 25% and 40% of the women who left welfare for work were back on AFDC within a year.5,10-12 Studies that examine job loss among former welfare recipients, regardless of whether they return to the welfare system or not, find even higher rates of job loss. Researchers at Project Match, a program that provides long-term, individualized employment services to AFDC recipients from the Cabrini-Green community in Chicago, found that 57% of employed participants lost their first job within six months.13 A study of the Massachusetts Employment and Training (ET) Choices Program in the 1980s found that, 12 to 16 months after leaving welfare for a job, 62% of participants had lost their first job, and almost half of those who had lost jobs remained unemployed.14
The pattern of rapid job acquisition and rapid job loss often repeats as low-income women return to welfare and then search for another job. This pattern is vividly portrayed in Table 1, which shows the employment patterns of a sample of AFDC recipients who found jobs in Portland, Oregon, in 1994–1995 and who were followed for a minimum of six months.15 There, 57% of those who found a second job also lost that one, but 69% of those women then went on to find a third job within the 6 to 12 months studied.
Job instability appears to be more common among women who turn to the welfare system for support than among those who never do. Information from the National Longitudinal Survey of Youth indicates that between ages 18 and 28, welfare recipients were almost as likely as nonrecipients to work. On the other hand, as Table 2 shows, they kept jobs for shorter periods, had longer periods between jobs, and spent only half as much time in the labor force over a 10-year period.