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November 2001
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Is Work Enough?
The Experiences of Current and Former Welfare Mothers Who Work
Denise F. Polit, Rebecca Widom, Kathryn Edin, Stan Bowie, Andrew S. London, Ellen K. Scott, Abel Valenzuela
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| I. Introduction
This report from the Project on Devolution and Urban Change (Urban Change,
for short) describes in rich detail the experiences of women from poor urban
neighborhoods who have relied on public assistance and were working in the
late 1990s. Their employment illustrates that many poor women are playing
by the new welfare rules, which emphasize that public assistance is temporary.
This report examines how such working women have fared. It shows that, although
these women typically face numerous challenges to employment, most have
worked in full-time jobs. Many women were able to maintain fairly stable
employment, others held a series of short-term jobs, and still others held
only a couple of jobs interspersed in long spells of unemployment. While
the employment and life experiences of these women were quite varied, their
economic circumstances were broadly similar: Few were able to lift their
families out of poverty, and most endured material hardships. While some
were accessing public safety net services to support their work effort,
most were not. Here is one of the many stories described in this report:
Anna, age 39, immigrated from Cuba to Miami when she was 20. Separated from
her husband, she was living with her two teenage children and worked 60
hours per week: 35 hours as a cook in a restaurant (where she had been working
for three years) and 25 hours in a retail sales job (which she had held
for eight months). Anna’s take-home pay from her restaurant job, which offered
paid vacation and health insurance but no sick pay, was $190 per week; her
second job added about $100 weekly. Her total annual earnings to support
herself and her two kids were about $15,000. She had left cash welfare and
no longer got food stamps, although she appeared to be eligible. She got
no housing assistance, either, and spent about 50 percent of her earnings
on housing. Anna’s two children did not have health insurance.
Anna could be described as a success story because she had been steadily
employed for several years and had health insurance. Despite her apparent
commitment to employment, however, Anna and her family were living below
185 percent of the federal poverty level, which is considered near-poor.
Few women in this study had achieved Anna’s level of “success.”
II. The Policy
Context
The plight of Anna and other working women who are poor or near-poor is
of special interest in the current policy environment. The passage in August
1996 of the Personal Responsibility and Work Opportunity Reconciliation
Act (PRWORA) brought about dramatic changes in welfare policies affecting
poor women with children. One of the key features of this act is that it
places a five-year lifetime limit on federally funded cash benefits for
the majority of recipient families. Thus, after their time limit is reached,
women who leave welfare for employment may not be able to rely on welfare
as a safety net program if they become unemployed.
During the late 1990s, the federal government also introduced or strengthened
policies aimed at assisting low-income workers. The main policy changes
include an increase in the minimum wage; the severing of the link between
cash assistance and Medicaid (which enables very low-wage working parents
to remain eligible for health benefits); the inauguration of the Children’s
Health Insurance Program (CHIP), which provides funding to states to cover
health care costs for children in low-income families; increases in child
care funding; and the expansion of the Earned Income Tax Credit (EITC) program,
a refundable credit originally designed to offset the burden of payroll
taxes for low-income workers. But are these policies enough? And are they
being implemented as envisioned? Recent evidence about declines in food
stamp participation and increases in the rates of the uninsured suggest
that public policy may need to develop or strengthen solutions to the problems
faced by the working poor.
The rapidly changing landscape of social policy has created a strong interest
in the lives and experiences of welfare recipients who are entering the
labor force. In addition, nearly all states and many localities have launched
studies to assess how recent welfare “leavers” (some of whom went to work)
have been doing. The Urban Change project is one of several studies that
are assessing the well-being of both welfare leavers and those who have
remained on welfare. Using data from the Urban Change project, the present
report contributes to the growing literature on the working poor by offering
a rich and in-depth description of women from poor urban neighborhoods who
have been welfare recipients and have found paid employment.
III.
The Urban Change Project
This report is based on data from the Urban Change project, which is being
undertaken by the Manpower Demonstration Research Corporation (MDRC), a
nonprofit, nonpartisan organization that develops and evaluates interventions
designed to improve the well-being and self-sufficiency of economically
disadvantaged populations. The Urban Change project, funded by a consortium
of organizations listed in the front of the report, is a multicomponent
study designed to examine the implementation and effects of PRWORA. The
study is being conducted in four large urban counties: Cuyahoga (Cleveland),
Los Angeles, Miami-Dade, and Philadelphia. It is important to note that
the present report does not provide information about the impacts of welfare
reform but, rather, is a portrait of the work experiences of some of the
women potentially affected by reform. Subsequent Urban Change reports will
address the issue of the impacts of welfare reform in these four counties.
Information for the present report came from two sources: (1) in-home survey
interviews with 2,860 women who had worked in the two-year period prior
to the interview; [1] and
(2) in-depth ethnographic interviews with a subset of 20 of the roughly
160 ethnographic cases across sites. The survey interviews were conducted
in 1998-1999 with a sample of women who, in May 1995, had been single mothers
receiving benefits and living in neighborhoods of concentrated poverty;
this sample was randomly selected from welfare agency records. (Anna, profiled
earlier, was a survey respondent.) These survey data were collected before
time limits were imposed on any recipients. With regard to the ethnographic
data, three rounds of interviews were conducted from 1998 through 2000 with
a sample of 30 to 40 recipients living in high-poverty neighborhoods in
each city. Twenty-one cases that typified patterns found among those women
who worked after the initial interview were selected for scrutiny.
In addition to providing an overall description of the work experiences
and life circumstances of these poor urban mothers, this report offers valuable
insights into how those experiences varied for four groups of women defined
on the basis of employment history: (1) currently employed women who had
worked in 19 or more of the 24 months before the interview (high employment
stability); (2) currently employed women who had worked in 7 to 18 of the
prior 24 months (moderate employment stability); (3) currently employed
women who had worked in 6 or fewer of the prior 24 months (low employment
stability); and (4) women who had worked in the two prior years but who
were no longer working. (Two-thirds of the women who had worked in the two
previous years were working at the time of the survey.) This report, then,
provides rich portraits of women whose work trajectories place them at different
levels and types of risk in the new welfare environment.
IV. Overview
of the Findings
- The majority of currently employed women in the
survey had fairly strong employment stability, having worked in most
of the prior 24 months. There was a fair amount of employment
stability among women in the survey: About 55 percent of the women who
were working had worked in 19 or more of the prior 24 months. Only 15
percent of currently employed women were in the low employment stability
group. Most women had held only one job in the two-year period, but
a noteworthy minority (predominantly those with moderate employment
stability) had had several short-term jobs. Although job stability is
generally considered desirable, the ethnographic data show that some
women were unable to leave an inadequate job because they had no time
to seek a better one and did not want to risk having a period without
employment.
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Full-time employment was
the norm, regardless of employment stability. The median number of hours worked was over 35
hours per week in all groups of currently employed women. Almost 7
percent of the women were working 50 or more hours in one job; some
were holding two jobs. The ethnographic data make clear the burdens
of low-wage single mothers who maintain a heavy work schedule while
still caring for children at home.
- The majority of women were working in low-wage
jobs, with earnings that would typically put them below the official
poverty level. The median hourly wage for currently employed
women in the survey was $7.00, ranging from $7.50 for those in the high
employment stability group to $6.35 for those in the low employment
stability group. Among all women who were working, 65 percent had earnings
that, if they had no other income source, would place their families
below the official poverty line.
- About two out of five currently employed women in the survey were
in jobs without any fringe benefits; fewer than half had employer-provided
health insurance. Full-time workers were less likely ― often
substantially so ― than workers nationally to have jobs that offered
paid vacation, sick pay, and health benefits for themselves and their
children. Women who were stably employed had jobs with more benefits
than others, but only about half were in jobs that offered health insurance.
The ethnographic data reveal that some women who were told that they
had benefits when they took a job later discovered that they could not
access benefits when they needed them; for other women, the copay for
health insurance premiums was too high to take advantage of this benefit.
- Among currently employed women who had moved from
one job to another over the two-year period, the median time elapsed
between jobs was two months. Spells of unemployment between
jobs were often brief and sometimes involved a transition from one job
directly into another. However, about one-third of the women in the
low- and moderate-stability groups had gone six months or more between
jobs.
- For women who had changed jobs, wage growth between
jobs was generally notable; however, wage loss was common among
women with the least work experience. On average, job-changers
in both the moderate- and high-stability groups saw increases in their
hourly wages — increases of 8 percent and 16 percent, respectively.
Among women with six or fewer months of work, wages declined by an average
of $0.35 an hour, a loss of nearly 5 percent. However, because women
typically increased the number of hours worked, average weekly earnings
increased among job-changers in all groups.
- Previously employed women had left jobs that were substantially
worse than the current jobs of women who were working. Women who no longer worked tended to have left low-paid full-time jobs
(with a median hourly wage of $6.53). Nearly a third had been in jobs
that paid at or below the minimum wage, and a full 77 percent had been
in jobs without any fringe benefits. Women who were no longer working
were as likely to have had a job end as to quit. Few previously employed
women in the survey had applied for unemployment benefits; less than
half of those who applied received them.
- Mothers’ earnings were the primary source of income
for the majority of households. Only about one-fourth of
the currently employed women lived in households with other wage-earners,
and about one-third had some income from welfare. Whether the mothers
were currently employed or not, the great majority of their families
would be classified as poor or near-poor (that is, below 185 percent
of the poverty line), based on total household income from all sources
in the prior month.
- The majority of women faced multiple material hardships, regardless
of employment stability. Food insecurity, housing insecurity, housing deficiencies,
residence in a dangerous neighborhood, and unmet needs for health care
were widespread. Although women who had been stably employed had fewer
material hardships than other women, many, despite their hard work,
nevertheless faced deprivations. For example, about 45 percent of these
women were food insecure, and a third lived in neighborhoods characterized
by gang violence and crime.
- Nearly all the women who worked faced barriers
or “challenges” to employment, but high-stability workers faced fewer.
Most women faced challenges to succeeding in the labor force but were
working nevertheless. As a group, these women tended to have limited
education credentials, were caring for several (often young) children
without a husband, often had health problems or children who had them,
were at risk of depression, and experienced an array of personal problems
(for example, domestic violence). The majority of the most stably employed
women had at least one such challenge, but they were half as likely
as low-stability workers and previously employed women to have multiple
problems. The ethnographic data provide rich accounts of how difficult
working can be in the context of such problems, and the difficulties
can be exacerbated by having jobs that do not offer paid sick days,
paid vacation days, or health insurance.
- Public safety net programs such as food stamps,
Medicaid, housing assistance, and child care subsidies were not used
by the majority of these women. Women who were combining
work and welfare (about one-third of the workers) were getting food
stamps and health insurance. However, only a minority of the working
women who had left welfare were getting food stamps, despite the fact
that many appeared to be income-eligible for them. High-stability workers
were more likely than other workers not to be getting food stamps despite
apparent eligibility. Regardless of employment stability, about one
out of four currently employed workers were uninsured in the month before
the interview, and one out of five had an uninsured child. Regardless
of employment status, only one out of six women had a child care subsidy.
The ethnographic data suggest that safety net services are not always
easy to access and that women (and sometimes their caseworkers) do not
always know about their eligibility for services.
V. Conclusions
In this sample of women drawn from some of the poorest neighborhoods in
the country, it is noteworthy that so many had been able to achieve fairly
high employment stability. Fully one-third of those who were working when
interviewed had been in the same job for more than two years ― a remarkable
rate of job stability for women workers in this population. The strong work
record of women in the survey sample presumably reflects, in part, the booming
economy. With labor in relatively short supply, employers may have been
more reluctant to fire or lay off workers than they were in the early 1990s.
It is also possible that the new work mandates of welfare agencies contributed
to employment stability; women may have stayed in jobs longer because they
knew they would have to meet participation/work requirements if they quit
and went back on welfare — and would have to use up scarce months of benefits
left on their time-limit clocks.
Despite their employment, however, most working women in the Urban Change
sample had jobs that would make lifting their families out of poverty difficult
without other income sources. Women with high employment stability were
in much better jobs than other women; as a group, they had higher earnings
and more often received fringe benefits. However, it is crucial to note
that even among those women who had worked virtually all of the preceding
two years, only half had jobs that offered health insurance, and most were
in jobs with low earnings.
Thus, many of those who are playing by the rules appear to be losing ground.
Their incomes are usually higher than would have been the case had they
remained on welfare, but many have lost valuable supports that they had
as recipients — most importantly, their health insurance. Although the government
has developed a number of important policies to address the needs of the
working poor, the data from this study suggest that more needs to be done
to “make work pay.”
[1] Surveys were completed with 3,933 women
who provided work histories. Women who had not worked in the two years before
the interview, making up 27 percent of the survey sample, are not described
in this report.
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Funders
Ford Foundation, Charles Stewart Mott Foundation, The Pew Charitable Trusts,
W.K. Kellogg Foundation, The Robert Wood Johnson Foundation, U.S. Department of Health and Human Services (including interagency funds from the U.S. Department of Agriculture),
Annie E. Casey Foundation, John S. and James L. Knight Foundation, The Joyce Foundation,
The Cleveland Foundation, The George Gund Foundation, William Penn Foundation,
The James Irvine Foundation, The California Wellness Foundation, The Edna McConnell Clark Foundation
The findings and conclusions presented in this report do not necessarily represent the official positions
or policies of the funders.
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