Economic Conditions and Welfare Reform by Sheldon Danziger

By Sheldon Danziger

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The Joint Center for Poverty Research at the University of Chicago and Northwestern University organized the conference, which was funded by the Office of the Assistant Secretary for Planning and Evaluation (ASPE) at the Department of Health and Human Services. Assisting me in planning the conference were Greg Duncan of Northwestern University and Donald Oellerich of ASPE. Special thanks are due to the conference discussants and participants, who provided valuable suggestions for the revisions that are published here, and to Julie Balzekas and Diane Kallenback for excellent staff assistance.

Reducing caseloads is a major goal of welfare reform, but it is not the only goal. One issue that has not been resolved in the few years since PRWORA was enacted is how recipients who have left the rolls are faring in the labor market. How interested are employers in hiring them? What kinds of jobs are they getting? How much are they earning? The tight labor markets and low unemployment rates of the late 1990s provide the best possible environment for welfare recipients who are entering the labor market.

Although there has been some discussion about how families that were receiving cash assistance are faring, much greater attention has been given by policymakers and the media to caseload declines. A few studies on how families are faring have recently appeared, and many more will appear in the next few years. It takes time to gather and evaluate this evidence, as it is more difficult to follow families leaving welfare and find out about their incomes than it is to count the number of families remaining on the welfare rolls.

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