The Lasting Impact of the Minnesota Family Investment Program

The Minnesota Family Investment Program (MFIP), implemented in seven Minnesota counties from 1994 to 1998, differed from the then existing welfare program in two key ways: It required long-term public assistance recipients to work or participate in employment services and included financial incentives to “make work pay” by allowing families to keep more of their welfare benefit when they worked.

MDRC examined the program’s effects over six years — to determine whether it increased its participants’ income or self-sufficiency during the three years after the program had ended. For the full sample of single-parent families, MFIP raised employment, earnings, and income through Year 4 of the follow-up period. But after this time, the program’s effects dissipated. In contrast, MFIP’s economic effects persisted up to Year 6 for the most disadvantaged single parents: long-term welfare recipients, those with little or no employment history, and those with no high school diploma or GED certificate. Even though their income remained lower than less disadvantaged single-parent families, the parents who had participated in MFIP earned $590 more in Year 6 than the control group. For the most disadvantaged welfare recipients, who were the least likely to have eventually gone to work on their own, MFIP seems to have created a lasting “leg up” in the labor market.

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