August 5, 2003

August 5, 2003 | Commentary on Jobs, Jobs and Labor Policy

A Solution that Works -- Literally

Should Congress make work requirements for welfare recipients stricter? That's what would happen under a bill the House of Representatives has passed. It would require more recipients to work 40 hours a week instead of the current 30 and stop vocational training from counting as "work."

Bad idea, the critics say. They claim that education and training programs lead to successful, high-paying careers, while putting welfare recipients to work immediately traps them in low-paying, dead-end jobs.

Wrong.

Welfare recipients assigned to immediate work see their earnings increase more than twice as fast over the following five years as those first placed in education-based programs, according to calculations we made using data from the Manpower Demonstration Research Corporation, a New York-based non-profit group.

In fact, most government-run job training programs barely raise hourly wage rates at all, a report commissioned by the U.S. Labor Department reveals.

If the goal of welfare reform is to raise earnings while reducing dependency, then quickly moving welfare recipients into real jobs is the answer. Prolonged classroom training tends to be the real dead end.

Prior to the 1996 welfare reforms, the Aid to Families with Dependent Children (AFDC) safety net was just that -- a net not only catching but also trapping nearly all who fell into it. Welfare reform replaced AFDC with a program called Temporary Assistance to Needy Families (TANF). This program was designed not as a net but as a trampoline, springing families back up to self-sufficiency by placing adults in permanent jobs.

The undeniable success of this approach is demonstrated by the more than 5 million people (including 3 million children) who have risen out of poverty since the law was enacted. After remaining static for nearly a quarter-century, the poverty rate of black children has dropped by a third and is now at the lowest point in U.S. history. The poverty rate for single mothers has plummeted in a similar manner since 1996; it, too, is at the lowest point in national history.

But welfare reform wasn't perfect. Today, less than half of TANF adult recipients are employed or are preparing for employment. Most remain idle while continuing to collect their welfare checks.

President Bush and his congressional allies want to strengthen welfare reform by increasing the TANF work-participation rate to 70 percent; opponents seem content excluding millions of families from working or even preparing to work. Yet those who would enact legislation that leaves hundreds of thousands of welfare recipients in idle dependence are clearly harming those they wish to help.

And those who believe welfare recipients are better served by education and training programs are ignoring the skills that would help these poor adults the most. A study conducted by the Washington-based Urban Institute shows that employers consider a positive attitude, reliability, work ethic and punctuality the most important traits they look for when hiring for entry-level positions. These traits can't be taught be in a classroom, or as part of a training program -- they are acquired through firsthand work experience. Not surprisingly, the same employers consider job training the least important qualification.

Unlike those stuck in a classroom or government-run job-training office, individuals placed in immediate work gain real-world experience mastering job duties. As they build work records, more job options and higher earnings become available. In the meantime, even minimum-wage workers can use the Earned Income Tax Credit, food stamps, Medicaid, the Child Care Development Fund, and the School Lunch Program to raise their total income to two-thirds above the federal poverty line.

Some critics insist that all employable adults have already left welfare, leaving only individuals with insurmountable personal barriers to work. Not true. Urban Institute data reveal the current welfare recipients are no less work-ready than those who have left welfare. In fact, a substantial number of them aren't classified as having any barriers to work. And most of those with such barriers as a lack of transportation, a slight disability, or an inability to speak English can, in fact, land jobs. But their chances of doing so are much better if we insist on immediate work.

Brian Riedl is the Grover M. Hermann fellow in federal budgetary affairs at The Heritage Foundation, where Robert Rector is a senior research fellow.

About the Author

Robert Rector
DeVos Center for Religion and Civil Society

Brian M. Riedl Grover Hermann Fellow in Federal Budgetary Affairs
Thomas A. Roe Institute for Economic Policy Studies

Related Issues: Jobs, Jobs and Labor Policy

Appeared in The Washington Post