How Welfare and Work Policies Affect Children

A Synthesis of Research

By Pamela Morris, Aletha Huston, Greg Duncan, Danielle Crosby, Johannes Bos

Over the past 30 years, welfare and other public policies for families living in poverty have developed a primary objective of increasing parents’ self-sufficiency by requiring and supporting employment. The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), passed in 1996, was a milestone in this effort, limiting the length of time that families can receive federal cash welfare assistance and requiring most of them to participate in employment-related activities to be eligible for such assistance. In addition, during the 1990s the maximum benefits available to working-poor families through the Earned Income Credit (the federal tax credit that supplements the earnings of low-income families), publicly funded health insurance, and child care assistance were expanded to reward work outside the welfare system. Because many of these benefit expansions encourage parental employment, and because other changes have weakened the safety net for families in which parents do not maintain employment, all these developments may have important consequences for children.

Proponents of changes in welfare policy have argued that parental employment benefits children by providing them with family role models who work and are self-sufficient and by introducing a regular schedule into the family routine. But employment may also create stress in the family, reduce parents’ opportunities to spend time with their children, and interfere with parents’ monitoring of their children’s activities ― particularly in single-parent families. Children may also be influenced by parental employment through changes in family resources: If family income or subsidies supporting such work-related needs as child care increase, children may benefit; if family resources decrease, children may be harmed. The critical question for policy is not “What are the effects of welfare reform on children?” Instead, it is “What program features are most likely to promote children’s well-being?” or, conversely, “What program features harm children or leave them unaffected?”

This monograph synthesizes the results of five large-scale studies that together examine the effects on children of 11 different employment-based welfare and antipoverty programs aimed primarily at single-parent families. (A companion document examines the effects of these and other programs on parental employment, welfare use, and income.) Specifically, we attempt to identify the program features that are associated with effects on children’s school achievement, social behavior, and health. Although most of the studies were under way by 1996, they were designed to test the effects of many program features that have been implemented by the states since the federal welfare law of 1996 was passed. The monograph is a product of the Next Generation project, a collaboration among researchers at MDRC and several leading research institutions that is being funded by the David and Lucile Packard Foundation, William T. Grant Foundation, and John D. and Catherine T. MacArthur Foundation.

Morris, Pamela, Aletha Huston, Greg Duncan, Danielle Crosby, and Johannes Bos. 2001. How Welfare and Work Policies Affect Children. New York: MDRC.