SECTION: CAPITOL HILL HEARING TESTIMONY

LENGTH: 3508 words

COMMITTEE: HOUSE EDUCATION AND THE WORKFORCE

HEADLINE: CHANGES IN THE WELFARE SYSTEM

BILL-NO:

 

H.R. 3113             Retrieve Bill Tracking Report


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TESTIMONY-BY: MARTHA DAVIS, LEGAL DIRECTOR

AFFILIATION: NOW LEGAL DEFENSE AND EDUCATION FUND

BODY:
TESTIMONY OF NOW LEGAL DEFENSE AND EDUCATION FUND ON "WELFARE REFORM: SUCCESS IN MOVING TOWARD WORK"

SUBMITTED TO THE UNITED STATES HOUSE 21ST CENTURY COMPETITIVENESS SUBCOMMITTEE OF THE EDUCATION AND THE WORKFORCE COMMITTEE

Hearing on "Welfare Reform: Success in Moving Toward Work" held on October 16, 2001

Martha Davis Legal Director

Sherry Leiwant Senior Staff Attorney

Yolanda Wu Senior Staff Attorney

NOW Legal Defense and Education Fund

Introduction

Thank you for the opportunity to testify today. The NOW Legal Defense and Education Fund has been working for more than thirty years to define and defend women's rights. One of our major goals is to eliminate barriers that deny women economic opportunities by addressing welfare reform issues from the perspective of ending women's poverty. To this end, we have convened the Building Opportunities Beyond Welfare Reform Coalition (BOB Coalition), a national network of local, state, and national groups, including representatives of women's rights, civil rights, anti-poverty, anti-violence, religious and professional organizations, to analyze the impacts of welfare reform and to develop more effective policy approaches. Based on both research results and first-hand experience, our coalition believes that changes in the 1996 law are necessary to insure that families are able to leave poverty. While welfare caseloads have declined around the country, poverty has actually deepened for many. More than 40 percent of former welfare recipients continue to live below the poverty line. (Urban Institute, "How Are Families That Left Welfare Doing? A Comparison of Early and Recent Welfare Leavers (2001)). In addition, the disposable incomes of the lowest fifth of families headed by women have declined since 1995. (Center on Budget Policy Priorities, "The Initial Impacts of Welfare Reform on the Incomes of Single-Mother Families" (Aug. 1999)).

About 25 percent of former welfare recipients have no paid employment and have either no partner or a partner who is unemployed. Of the 64 percent of former recipients who are employed, their median hourly wage is a mere $7.15, and many did not receive that hourly rate on a full-time basis. (Urban Institute, "How Are Families That Left Welfare Doing? A Comparison of Early and Recent Welfare Leavers (2001)). A GAO report on welfare recipients in seven states found that most former recipients found jobs in low-wage occupations such as restaurant and retail sales. Their average hourly wage ranges from $5.67 in Tennessee to $8.09 in Washington state. (General Accounting Office, "Welfare Reform: Information on Former Recipients' Status." GAO-HEHS-99-48 (Apr. 1999)). Because welfare leavers lack the necessary skills to progress beyond the low wage market into jobs that pay a living wage, in the wake of welfare reform such workers are likely to experience little wage growth. (U.S. Dep't of Health & Human Serv. "The Low-Wage Labor Market: Challenges and Opportunities for Economic Self-Sufficiency," Kaye & Nightingale, eds. (2000)).

These numbers take a human toll. A recent analysis of welfare-to- work programs shows that children's well-being is tied to their parent's income, as opposed to employment rates. In fact, several welfare programs that increased employment without lifting income were found to do more harm than good for children. (Children's Defense Fund, "How Children Fare in Welfare Experiments Appears to Hinge on Income" (Aug. 22, 2001)).

So far, states have been able to meet TANF's work participation requirements. But they did so during a period of unprecedented economic expansion. Declining caseloads and an expanding economy are almost certainly a thing of the past. There can be no doubt that the economic uncertainty wrought by the September 1 Ith terrorist attacks and the deepening recession put our nation's poor in an even more precarious position, and will make it more difficult for states to meet their mandatory work participation requirements. As more workers are laid off, welfare recipients will increasingly be competing with more experienced and highly educated workers for scarce jobs. Under the circumstances, perpetuating Federal restrictions on education and training activities will hinder states from making the most effective decisions to promote long-term economic stability for their welfare caseload.

THE CASE FOR EDUCATION AND TRAINING

Both research and real-life experience underscore the importance of education and training in helping welfare recipients attain economic self-sufficiency. When TANF was enacted in 1996, the strong desire to make it a "work first" program led Congress to place limits on states' ability to include education and training in their welfare programs. TANF specifically prohibits states from counting higher education as an allowable work activity, imposes a 12 month limit on participation in vocational education, and prohibits states from having more than 20% of their TANF work participants in secondary school or vocational education. 42 U.S.C.S 607(d). What we have learned over the past few years about the welfare caseload, about successful work programs and about the need for more emphasis on poverty reduction makes it clear that the original restrictions on education and training are too extreme and that a correction is necessary in order to free states to address the needs of poor families and help them achieve self sufficiency.

Experience under TANF and current research demonstrates that welfare programs that include education and training as part of a spectrum of activities can produce more positive and longer- lasting effects on earnings than programs that provide only job search assistance. Studies indicate that the most effective welfare to work programs have had a flexible, balanced approach that offers a mix of job search, education, training and work activities and tailors those activities both to the needs and abilities of individual recipients and to the opportunities in the local job market. (W.K. Kellogg Foundation, "Workforce Development: Employment Retention and Advancement Under TANF" (Sept. 2001); Stephen Freedman, " Evaluating Alternative Welfare to-Work Approaches: Two Year Impacts for Eleven Programs (U.S. Department of Health and Human Services and U. S. Department of Education (2000); Marie Cohen, "Education and Training Under Welfare Reform" (Welfare Information Network, 1998); Center on Law & Social Policy, "Beyond Job Search or Basic Education: Rethinking the Role of Skills in Welfare Reform" (1998)).

Because education and training programs can help move women into better jobs and can help remove barriers to long-term employment, Federal law provisions which currently prevent or discourage states from including education and training in their welfare programs should be removed. Indeed, states should be encouraged to include individualized assessment, analysis of local job availability and education and training in their TANF work programs. The TANF Reauthorization Act of 2001 (H.R. 3113) would remove the arbitrary 12 month limit on training and the 20 percent limit on training or educational activities. It would also make it clear that education, including ESL, GED and higher education, are work activities.

Post-High School and Post-Secondary Education: If our goal is to reduce poverty for our nation's most vulnerable families, the next round of welfare reform must concentrate on insuring that women have jobs that pay them enough to support their families. Including education and training as part of the welfare program will help with both of these goals. Research suggests that gaining a college degree is an effective way of increasing an individual's employment and earnings. Data show that people with a college education earn substantially more than those who have not attended college. Using the National Longitudinal Survey and attempting to control for differences between those who did and did not enter college, Thomas Kane and Cecilia Rouse estimated that hourly earnings increase by approximately 19% to 23% for women earning an Associate's degree and 28% to 33% for those earning a Bachelor's degree. Research indicates that post-high school education or training is also strongly linked to subsequent higher wages. (W.K. Kellogg Foundation, "Workforce Development: Employment Retention and Advancement Under TANF" (Sept. 2001)). Significantly, starting off in a higher paying job is linked to both greater employment retention and job advancement. (Id.)

Despite the positive effects of education, following enactment of TANF, many states restricted access to education and training for TANF recipients in order to be consistent with Federal requirements. In some states, stand-alone college education was permitted only to students who had begun their studies before the implementation of welfare reform. An additional 15 states provided support services for school attendance for TANF recipients who attended school on their own time after complying with work requirements. Out of 15 states that responded to an informal survey by the American Association of Community Colleges, two responded that their state welfare agencies were not counting work-study assignments as TANF work activities. There have been large drops in the number of students on welfare at several campuses and community college systems.

Despite Federal restrictions, some states have successfully experimented with postsecondary education components to their welfare programs. In part, states could do this because a strong economy insured they would meet work participation requirements under TANF even if portions of their caseload were participating in educational activities that would not count as work activities under Federal standards. For example, Maine created a separate program to enable up to 2,000 students to receive aid without being subject to TANF participation requirements and time limits. Students meeting certain requirements receive benefits equivalent to the cash aid, medical coverage, transitional benefits, and other services they would have received had they become TANF recipients, but can remain in school without penalty. In Wyoming a small student aid program, funded through state maintenance-of- effort funds is available instead of a TANF grant to recipients who have completed an employment assessment, meet income and resources eligibility requirements, and are full-time students in an approved program.

In addition, several states are promoting job retention and advancement by helping former TANF recipients continue their education to help with. Florida pays the costs of education, training and necessary support services for up to two years for anyone who leaves TANF for employment and wants to obtain further education and training. Utah pays for up to 24 months of education, training and needed support services for those who leave TANF.

States' successful experimentation with allowing post-secondary education as a component of welfare reform should be encouraged in any Federal reauthorization of the TANF program. In light of the worsening economy, states may not feel they can afford the luxury of including education and training programs if they will not count toward Federal work participation goals. It is therefore essential that a reauthorized TANF eliminate restrictions on educational components in state programs.

Basic education: A large proportion of welfare recipients have very low educational and skill levels. One study of a nationally representative sample of single welfare mothers found that 64 percent lacked high school diplomas. (Institute for Women's Policy Research, "Welfare That Works: The Working Lives of AFDC Recipients" (1995); Marie Cohen, "Education and Training Under Welfare Reform," Welfare Information Network Issue Note 2 (2) (Mar. 1998); Urban Institute, "Work-Related Activities and Limitations of Current Welfare Recipients," (1999)). Welfare recipients ages seventeen through twenty-one read, on average, at the sixth grade level. (National Center for Family Literacy, "Facts and Figures," (1997)). Lack of literacy and basic education translates into less access to entry level jobs in most fields and poor pay when jobs are found. The National Institute for Literacy finds that workers who lack a high school diploma earn a mean monthly income of $452 as compared to $1829 for those with a bachelor's degree. (National Institute for Literacy, "Facts on Literacy" (1996)).

Just as having basic skills increases the likelihood of job advancement, lack of basic education can be a major barrier to sustained employment. In addition, low literacy and low educational attainment can indicate learning issues that may need to be addressed. Studies in Washington state, for example, revealed that 35% of the caseload in two counties were learning disabled.

Many states are screening for low literacy and possible learning issues and are piloting projects to use curriculums designed for low level readers to increase their literacy skills. Washington, Kansas and Missouri have undertaken pilot projects to screen for learning disabilities and refer to appropriate vocational and educational services. Tennessee, Oregon, Kansas and New Hampshire have special projects to screen and refer recipients to educational programs designed to raise their specific reading skills using techniques geared to individual learning needs with an eye to what skills are needed for employment. (National Governor's Association, Issue Brief, "Serving Welfare Recipients with Learning Disabilities in a Work First Environment (July 28, 1998)). Family literacy programs have also been used in a number of states to increase literacy for parents on welfare. These programs educate both children and parents and focus on the importance of literacy for all members of the family. Research indicates that these programs have been successful in both raising literacy and increasing job placement and retention. (National Governor's Association, Issue Brief, "States Can Use Family Literacy Programs to Support Welfare Reform Goals (June 4, 1998)).

It is important that states screen for barriers to employment such as low literacy and learning disabilities and be allowed, indeed encouraged, to offer innovative basic education programs.

Job Skills Training: Job skills training can and should play a critical role in assisting welfare recipients in attaining economic self-sufficiency, even within the "work first" framework. Studies have shown that although welfare-to-work programs that promote rapid labor force attachment increase earnings and work hours for participants, the most persistent rise in earnings are found in programs that emphasize human capital development, i.e,. investment in education and training. Importantly, education and training are more effective strategies for increasing self-sufficiency over time. (Manpower Demonstration Research Corp., "Work First: How to Implement and Employment-Focused Approach to Welfare Reform" (1997)). One study analyzing the cost effectiveness of Job Training Partnership Act funded job training programs found that for low-skill welfare recipients, job search assistance alone produced little or no benefits while more intensive skill-building training was the most cost-effective in the long term. (Joint Center for Poverty Research Working Paper #3, "Aiding Welfare-to-Work Transitions: Lessons from JTPA on the Cost Effectiveness of Education and Training Services" (1998)). Another study also confirms that although job search can increase employment in the short term, it has no long term effect on employment or earnings. (Center on Law and Social Policy, "Beyond Job Search or Basic Education: Rethinking the Role of Skills in Welfare Reform" (1998)).

The research analyzing job training programs suggests a number of "best practices." First, job training programs should target high quality jobs. Such programs gather information about the local living wage, high-wage growth industries, and the skills and interests of potential job seekers. Training women for occupations typically filled by men is one important example of such a "best practice." Many jobs, in which women are poorly represented, such as jobs in the skilled trades, technology, law enforcement and the computer industry, to name just a few examples, pay good wages with benefits and provide opportunities for career advancement. Numerous studies have documented the success of nontraditional job training programs in placing women in higher paying jobs. For example, a study by Wider Opportunities for Women found that women who received training for nontraditional jobs earned between $8 and $9 an hour. (Spalter-Roth et al., "Welfare That Works: The Working Lives of AFDC Recipients, A Report to the Ford Foundation" (1995)). By contrast, in 1997 the average welfare recipient moving from welfare to work earned between $5.60 and $6.60 an hour. (U.S. General Accounting Office, "Welfare Reform: States and Restructuring Programs to Reduce Welfare Dependence," 107 (June 1998)). Not only do nontraditional jobs provide higher entry- level wages, but they also provide career ladders to higher wages. For instance, an operating engineer could start by earning $9 per hour and eventually earn $24 per hour. (Wider Opportunities for Women, Women and Nontraditional Work (June 1998) (citing U.S. Dep't of Labor, Bureau of Labor Statistics, and the U.S. General Accounting Office)). Nontraditional jobs also provide women with increased access to a full range of benefits, such as health, family leave, sick leave, retirement plans, and paid vacation. Finally, nontraditional jobs can provide women with tremendous job satisfaction. Women in nontraditional jobs may gain confidence in performing physical labor and take pride in learning new and technical skills.

Sectoral initiatives are another "best practice." Sectoral employment programs target an occupation within an industry and then intervene to assist low-income people in obtaining such jobs with the eventual goal of systemically changing the occupation's labor market. This approach benefits low-income people, who are trained to meet existing needs, as well as the community, which can meet the demands of the labor market with trained workers.

Another "best practice" is to focus on long term job retention and career advancement instead of job placement. Post-employment training can be an excellent way to support people who have jobs but who have not attained self-sufficiency. One encouraging sign is that a number of welfare-to-work grantees have developed innovative post-employment education and training. (Urban Institute, "The Status of the Welfare-to-Work (WtW) Grants Program After One Year" (Sept. 1999)).

Finally, an important "best practice" is for job training programs to address barriers to self-sufficiency. Many recipients left on the rolls struggle with multiple and severe barriers to employment and self-sufficiency. Over half of women receiving welfare have been victims of domestic violence as adults. According to several studies, a quarter to a third of welfare recipients report having been abused within the last year. Abusive partners often interfere with women's attempts to work or to obtain education. Jody Raphael, "Trapped by Poverty, Trapped by Abuse" (Taylor Institute, 1997); Eleanor Lyon, "Poverty, Welfare and Battered Women: What Does the Research Tell Us?" (Department of Health and Human Services, Welfare and Domestic Violence Technical Assistance Initiative, 1998) Thirty-five percent of low-income families reported having poor mental health through measurement of anxiety, depression, loss of emotional control, and psychological well-being. (Urban Institute, "Work Activity and Obstacles to Work Among TANF Recipients," (1999)). Similar rates have been found among welfare recipients. (Sandra Danziger "Barriers to the Employment of Welfare Recipients," Ann Arbor, MI: University of Michigan, Poverty Research and Training Center, School of Social Work (2000)). Lack of child care and transportation are also significant barriers to economic sufficiency. Job training programs that address these barriers have the best chance of success. Conclusion

The widespread "work first" approach calls for recipients to take the first available job, regardless of skills or work experience. But research shows that a "one size fits all" approach neither serves the recipient nor the public policy goal of increasing self-sufficiency. The most effective education and training programs must provide flexible, customized training for a diverse population. The range of services should include basic/remedial education, soft and hard skills training, on-the-job training, and should address multiple barriers to economic-selfsufficiency faced by welfare recipients.



LOAD-DATE: October 19, 2001