Welfare Reform Increased Job and Earning Opportunities for Welfare Recipients

  • Publication Date: August 2003

  • Topics: Minimum Wage

Washington – Current and former welfare recipients found increased employment opportunities, higher average earnings and a reduced likelihood of a return to government assistance as a result of welfare reform efforts, according to a new study released today by the Employment Policies Institute (EPI). The results are presented as Congress reviews reauthorization of the 1996 Personal Responsibility and Work Opportunity Reconciliation Act (Welfare Reform Act).

“This study shows that welfare reform was timed perfectly to take advantage of the economic expansion in order to move fully capable and employable participants off of the welfare rolls and into the labor market,” EPI economist Craig Garthwaite said. “The coupling of welfare reform with the economic expansion provided these individuals with the opportunity to better their lives through increased skill level and increased compensation.”

The study, entitled Welfare Reform and Its Effect on the Dynamics of Welfare Recipient, Employment, and Earnings, by Drs. Peter Mueser and Kenneth R. Troske of the University of Missouri, found:

  • The employment rate of welfare recipients and those leaving the system nearly doubled since the early 1990s.
  • Post-reform welfare recipients enjoyed earnings that were 27% higher than their counterparts before welfare reform.
  • The study also finds a 25% decline in the probability of an individual returning to welfare after joining the workforce since welfare reform.

To view Welfare Reform and Its Effect on the Dynamics of Welfare Recipient, Employment, and Earnings, visit www.EPIonline.org or contact Barnaby Towns at (202) 463-7650 to request a copy or schedule an interview.