Welfare Reform that Really Works #8

WILL WASHINGTON STATE WELFARE REFORM MOVE PEOPLE TO EMPLOYMENT?

A key element of meaningful welfare reform is employment; making sure those able to work do so, and keep working. We must avoid yet another well-worn path to increased dependency on government programs.

The federal government looked at state reform successes and found a common element: WORK. Wisconsin's caseload is down 50% since 1987. In the last two years, Indiana's is down by 32%; Oregon by 42%; Maryland by 29%; Massachusetts by 25%; Oklahoma by 24%; and Michigan by 22% (Washington state by 3.6%). Those unable to find work after 4-6 weeks of intensive job search are moved to supervised community service jobs. But work is immediate and continuous.

In Washington state, the primary work focus is on two programs: JOBS (Job Opportunities and Basic Skills) and the JPTA (Job Partnership Training Act). The assumption is that federal welfare reform work requirements will be met as increasing numbers of welfare recipients are added to the JOBS program and/or JPTA.

Since JOBS and JPTA have been operational as federal programs for 10-14 years, they have "track records." Are they viable programs that will move Washington welfare recipients to the workforce?

Background: The Department of Labor runs the $5 billion JPTA program, which is based on the assumption that job training best prepares a person for a job. How much do they help their clientele? "Zero is not a bad number," concludes James Heckman of the University of Chicago, who directed a government-financed study of JTPA, one of 163 federal job training programs.

In Washington state, examples of JPTA programs include Title III Dislocated Workers Programs, allocating $6,700,000 in FY93 and Title II programs (adult training, summer youth training, and youth training). Total JPTA funding in this state from July 1, 1996 to March 1997 was $63,000,000. In 1994 testimony before a House subcommittee, the Government Accounting Office (GAO) described JPTA as "¼a fragmented system that wastes resources and confuses and frustrates clients, employers, and administrators." Testimony in early March 1997 indicated that GAO's evaluation is still applicable.

In 1988, the JOBS program began as a voluntary work program for welfare recipients. It became mandatory because of insufficient voluntary participation.

In fiscal years 1994-1996, monthly AFDC participation in Washington state JOBS averaged 35,000 people. In April 1996, more than 2000 people were placed in jobs via the program. Yet in all of 1996, the AFDC caseload in Washington state dropped by less than 2000 persons, with a total JOBS fiscal outlay of $25,000,000. This means that although more people were served, the actual cost of each of those jobs for the state was $12,747. Those are taxpayer dollars "invested" in a program that does not have a direct cause-effect relationship to employment.

Prepared by Karen Woods, Research Analyst
(360) 956-3482

Federal welfare reform eliminated JOBS as a federal program but allows states to continue JOBS with their own funding, if they choose. This state continues the JOBS program with state funds. JPTA remains a federal program.

Problems: In 1994, seeing the marked fragmentation and service duplication, the U.S. Senate Committee on Labor and Human Resources tried to consolidate various JOBS and JPTA programs. The same year, the GAO concluded: "Many programs do not collect data on whether participants obtained jobs."

The JOBS program in Washington state has been under similar tough criticism for lack of performance accountability. In December 1996, the Joint Legislative Audit and Review Committee (JLARC) concluded: "The JOBS program had three modestly positive outcomes for the entire JOBS sample. These results were in line with evaluations of the JOBS program in other states, which suggest that employment-related rather than education related, components may be more effective.Expenditures were not commensurate with their effect."

Specific JLARC conclusions are disturbing: e.g., "Clients are not adequately monitored. DSHS (Department of Health and Human Services), ES (Employment Security), and third party contracts sometimes duplicated the assessment of JOBS clients.Clients are not sanctioned when appropriate, because the sanctioning procedure is considered too cumbersome." Further: "There are no standard contract outcome measures for services provided.The contracts are not competitively awarded. Contracts are not adequately monitored."

Benchmark: Robert Rector, noted national welfare analyst at the Heritage Foundation, contends that Wisconsin is truly ending welfare because the state embraces work for everyone. Welfare clients are no longer considered a "subculture" of assistance recipients who must now be moved to the workforce. Every able adult in Wisconsin is expected to work to the level of his ability. Low income-adults must begin to work as quickly as possible and continue moving up the workfare ladder. Support services such as child care are simply tools to enable parents to work. Training and education programs are de-emphasized; they aren't work, and they don't work.

Prognosis: Although mandated by the Washington state legislature in 1993, there is no direct link of the JOBS and JPTA training and education programs to actual employment. JOBS has been a mandatory participation program for AFDC recipients since 1995, yet the dent in the state caseload is minimal. JPTA programs, serving just about every conceivable disadvantaged group of people, are still labeled "...ineffective, inefficient, and in need of massive overhaul to reduce the billions consumed annually." A proposed accountability mandate in a 1997 welfare reform bill, ESB3901(Sec702) addresses "Outcome Measures." Although the data collected in response to these six suggested measures will prove interesting, there are no performance benchmarks. The provision of bonuses to offices, regions, and employees with the best outcomes are strictly elective; non-performance has no consequences.

The work component of welfare reform is foundational and effective. But to add more participants to programs that have been pronounced ineffectual and costly by both federal and state officials is unwise.

Washington state defines "work" as moving welfare recipients into training and education. Sadly, this means recipients will still be dependent on government programs with no indication of direct impact on employment. The Insatiable Welfare Bureaucracy will gobble state resources instead of federal ones, and the caseload won't move. Job training and education programs sound like a reasonable and compassionate solution. They aren't. The solution that does work is immediate labor force attachment.

Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org