Welfare According to Reports Published

Welfare

According to reports published by organizations like the Urban Institute and MDRC, welfare-to-work programs have produced some positive results in terms of improving the economic well-being of single parent-run households. The UI report examined the economic impact of the 1996 federal welfare-to-work legislation upon such households. The MDRC report looked at how one state's welfare-to-work program affected the financial well being of several families, including those headed by single parents.

In 1996 the federal government effectively replaced the Aid to Families with Dependent Children (AFDC) program, which had offered unconditional support to needy families in the form of welfare checks, with the Temporary Assistance for Needy Families (TANF) program, which offered temporary support to able-bodied needy families provided they eventually left welfare by seeking out employment. Acs, Coe, Watson, and Lerman (July 1, 1998) conducted a study to determine whether TANF was beneficial to single parent households, particularly those run by mothers with two children. According to their research, TANF did provide several incentives to its recipients for seeking employment, thereby raising their standard of living.

The first incentive was that as a mother moved from being unemployed to performing part-time work at minimum wage, her total income increased by 51% on average. The second incentive was that as this same mother moved from part-time to full-time work at minimum wage, her total income increased by 20% on average. The third incentive was that as the mother changed full-time jobs from one being at minimum wage to one being at $9.00/hr, her total income increased by 16% on average. The fourth incentive was that federal and state Earned Income Tax Credit programs helped to significantly raise the income of families who moved from unemployment to minimum wage work.

In addition to TANF, Acs et al. (July 1, 1998) found that other benefit programs also helped to raise the standard of living for single parent-run households. So with federal housing assistance, an average family of three's income moving from no work to part-time minimum wage work would rise by 30%. Government subsidies significantly offset childcare costs, thereby helping a family's net income to rise, as happened in Colorado where the income of single mothers on TANF rose by 54% on average due to not having any childcare costs. In terms of health benefits TANF allows its recipients to continue being eligible for Medicaid even after becoming employed so they do not have to be concerned about health care costs.