Alternative Outcome Measures:
TANF Block Grant

Appendix C:
Participation Requirements for Welfare Recipients Under the JOBS and TANF Programs

[ Main Page of Report ]

Contents

Introduction

One of the major elements of the welfare reform act is the requirement that states mandate adults to participate in welfare-to-work programs as a condition of their receiving cash assistance. The Personal Responsibility and Work Opportunity Reconc1iliation Act (PRWORA) of 1996 requires states to meet new and more stringent participation requirements for adults receiving assistance through the Temporary Assistance for Needy Families (TANF) program. The TANF participation requirements replace those established by the Job Opportunities and Basic Skills Training (JOBS) program created by the Family Support Act of 1988.

Participation requirements in welfare-to-work programs require states to involve a certain portion of their welfare population in welfare-to-work activities or face financial penalties. In JOBS and TANF, participation in welfare-to-work programs is measured by a monthly participation rate — a ratio which represents the number of individuals who participate in the welfare-to-work program (the numerator) out of all those expected to participate (the denominator). The stringency of the participation requirement is dependent on both the level of the rate states are expected to meet and how the numerator and denominator of the rate are defined.

To provide an understanding of participation mandate changes between the JOBS and TANF programs, this paper provides a comparison of the participation requirements under the two programs. The paper explores the key ways in which the measurement of participation — as expressed by the monthly participation rate — varies in these two programs. The first section of the paper examines the proportion of the welfare caseload states are expected to involve in welfare-to-work activities under JOBS and TANF. The second section explains how the denominator of the rate is defined under the two programs; this is followed by a discussion of how the numerator of the rate is defined. Finally, the paper discusses factors that may affect a states’ ability to achieve the expected levels of participation.

What Rates are States Required to Meet?

The statutes governing the JOBS and TANF programs established target participation rates that states are required to meet. Both programs established an overall rate (which includes both single and two-parent families) and a separate rate for two-parent families. As shown on Table 1, both programs had target participation rates that increased over time, however, the target participation rates in the JOBS program were substantially lower. The target overall rate in JOBS increased from 7 percent in Fiscal Year (FY) 1990 to 20 percent in FY 1995, while in TANF it started at 25 percent in FY 1997 and increases to 50 percent for FY 2002. The differences in the rates between the two programs are not as dramatic for the two-parent rate. In JOBS, the two-parent rate increased from 40 percent in FY 1994 to 75 percent in FY 1998(1), while in TANF this rate started at 50 percent in FY 1997 and increases to 90 percent in FY 2000.

Table 1
Required Participation Rates in the JOBS and TANF Programs
    JOBS Program TANF Program
Year Overall Two-parent Families Overall Two-Parent Families
Year 1 7% 40% 25% 75%
Year 2 7% 50% 30% 75%
Year 3 11% 60% 35% 90%
Year 4 11% 75% 40% 90%
Year 5 15% 75% 45% 90%
Year 6 20% None 50% 90%

In both programs, states are subject to financial penalties if they do not meet the required participation rates. In JOBS, a state’s federal matching rate for the JOBS program could be reduced if it failed to meet the participation requirements. Under TANF, states face up to a five percent reduction in their TANF block grant and an increase in the maintenance of effort requirement (from 75 percent to 80 percent) for not meeting these requirements

While the statute governing the TANF program sets target participation rates, there is another provision in this law that affects the actual rate each state is expected to meet. This provision — known as the caseload reduction credit — allows states to reduce their participation rates based on declines in their TANF caseload. Specifically, participation rates are reduced by one percentage point for each percentage point that a state’s welfare caseload in the last fiscal year is below FY 1995 levels. Both the overall and the two-parent rate can be reduced by the caseload reduction credit; however, caseload decreases due to changes in federal law or in state-defined eligibility criteria do not count toward the credit. For example, a state that experienced a ten percent caseload decline between FY 1995 and FY 1997 would be required to meet an overall participation rate of 15 percent (rather than 25 percent) for FY 1997.

To date, the caseload reduction credit has had a significant effect on the participation rates states are required to meet. Table 2 shows the "adjusted target" for the overall rate — the participation rate that takes the caseload reduction credit into account — for each state in FY 1997 and FY 1998. As shown, as a result of the caseload reduction credit, in FY 1998, some states — such as Indiana, Wisconsin, and Wyoming — had their overall participation rate reduced to zero. Others — such as Alaska and Hawaii — only had a small reduction in the FY 1998 target participation rate of 30 percent.

Table 2.
TANF Overall Participation Rates, FY 1997-99
(in percents)
State FY1997 FY1998 FY1999
(Target Rate = 25 Percent) (Target Rate = 30 Percent) (Target Rate = 35 Percent)
Adjusted Target Rate Achieved Adjusted Target Rate Achieved Adjusted Target Rate Achieved
Alabama 17.1 42.3 5.0 38.9 0.0 37.4
Alaska NA NA 26.8 42.5 16.8 46.0
Arizona 16.1 26.9 8.7 30.2 0.0 32.1
Arkansas NA NA 16.6 19.4 6.0 23.7
California 19.5 20.6 17.7 36.6 8.5 42.2
Colorado NA NA 7.5 28.7 0.0 36.4
Connecticut 20.3 58.4 21.5 41.4 19.7 47.4
Delaware NA NA 9.4 26.2 0.0 24.9
DC 21.0 31.3 20.1 22.8 13.9 26.7
Florida 16.4 28.4 5.8 34.5 0.0 31.6
Georgia 18.7 20.6 6.1 29.3 0.0 17.6
Guam NA NA 30.0 12.4 35.0 16.1
Hawaii NA NA 28.1 30.0 23.1 41.1
Idaho NA NA 4.2 28.6 0.0 43.7
Illinois NA NA 13.6 37.7 6.1 60.4
Indiana 5.6 25.3 0.0 29.9 0.0 33.3
Iowa 14.9 52.8 9.1 56.9 4.7 54.8
Kansas 14.1 33.3 1.9 41.3 3.9 57.3
Kentucky 20.3 33.1 16.3 39.3 5.8 38.1
Louisiana 13.4 13.5 2.0 29.2 0.0 29.4
Maine 19.3 41.6 15.1 45.6 5.9 54.9
Maryland 16.3 18.3 3.1 12.7 7.2 11.2
Massachusetts 12.6 31.5 7.3 29.0 0.9 27.8
Michigan 13.3 41.1 5.2 49.2 0.0 43.8
Minnesota NA NA 17.0 30.6 13.7 36.9
Mississippi 16.3 17.2 3.7 25.2 0.0 27.0
Missouri 17.6 23.2 10.4 24.1 2.2 28.2
Montana 19.2 49.5 7.2 78.3 0.0 92.3
Nebraska 20.5 34.0 20.6 36.2 19.7 34.7
Nevada 20.0 31.2 6.0 34.5 1.1 34.8
New Hampshire 13.3 36.1 5.5 37.3 0.0 29.9
New Jersey 19.5 20.7 14.7 26.5 7.1 30.3
New Mexico NA NA 8.5 15.9 0.0 27.6
New York 19.6 27.9 15.0 37.5 8.3 36.3
North Carolina 15.1 25.9 10.0 14.5 0.0 16.0
North Dakota NA NA 10.7 31.5 0.8 31.7
Ohio 15.6 38.3 11.6 44.9 1.4 53.7
Oklahoma 11.6 27.8 0.0 35.2 0.0 42.9
Oregon 10.2 96.7 0.0 98.2 0.0 96.7
Pennsylvania NA NA 9.9 19.3 0.9 16.2
Puerto Rico NA NA 17.1 6.8 12.3 20.7
Rhode Island NA NA 19.3 27.5 22.0 28.8
South Carolina 18.4 38.9 19.0 42.7 6.7 44.7
South Dakota 20.4 44.8 11.2 39.2 1.6 46.5
Tennessee 20.3 38.6 2.0 43.2 0.0 41.1
Texas 14.6 19.4 5.2 25.2 0.0 27.3
Utah 13.7 39.6 2.5 39.8 2.2 44.0
Vermont NA NA NA NA NA NA
Virgin Islands NA NA 27.7 15.5 19.7 11.5
Virginia 15.6 17.3 6.8 27.5 0.0 41.1
Washington 22.0 24.0 21.1 48.5 12.9 40.3
West Virginia 15.0 18.3 19.2 33.4 0.0 25.6
Wisconsion 8.0 52.8 0.0 64.0 0.0 80.1
Wyoming 16.0 52.6 0.0 55.3 0.0 57.7
National Average   28.1   35.4   38.3

Table 3 provides this information for the two-parent rate. As with the overall rate, the caseload reduction credit has had a significant impact on the two-parent rates in some states. While some states still have to meet relatively stringent rates, in FY 1998, 10 states had their participation requirement for two-parent families cut to 10 percent or less (compared to a target rate of 75 percent).

Table 3.
TANF Two-Parent Participation Rates, FY 1997-99

(in percents)
State FY 1997 FY 1998 FY 1999
(Target Rate = 75 Percent) (Target Rate = 75 Percent) (Target Rate = 90 Percent)
Adjusted Target Rate Achieved Adjusted Target Rate Achieved Adjusted Target Rate Achieved
Alabama 35.8 31.5 NA NA NA NA
Alaska NA NA 68.6 36.8 66.8 44.8
Arizona 66.1 68.8 53.7 76.6 48.9 88.4
Arkansas NA NA 57.8 20.3 61.0 10.5
California 68.0 24.5 32.7 36.2 36.9 54.3
Colorado NA NA 15.1 25.7 44.9 41.2
Connecticut 70.3 90.6 66.5 73.2 NA NA
Delaware NA NA 54.4 23.7 NA NA
DC 48.2 14.0 30.1 22.5 23.3 19.5
Florida NA NA NA NA NA NA
Georgia NA NA NA NA NA NA
Guam NA NA 75.0 13.0 90.0 10.7
Hawaii NA NA NA NA NA NA
Idaho NA NA 0.0 22.5 20.6 44.0
Illinois NA NA 45.0 77.7 46.2 92.4
Indiana 35.1 35.2 20.1 32.8 32.3 41.4
Iowa 64.9 48.5 51.4 53.6 49.0 55.5
Kansas 44.0 33.7 23.2 44.2 56.9 64.9
Kentucky 50.8 51.9 37.5 52.4 17.6 46.6
Louisiana 5.7 15.4 0.0 38.1 33.5 43.1
Maine 61.7 50.5 35.3 49.9 23.6 51.0
Maryland NA NA NA NA NA NA
Massachusetts 52.1 71.1 44.6 73.3 55.9 66.4
Michigan 60.3 47.4 38.4 63.9 15.2 69.1
Minnesota NA NA 42.5 30.8 68.7 43.6
Mississippi 54.0 24.4 1.2 70.4 39.7 87.5
Missouri 21.7 47.8 0.0 34.9 0.0 29.8
Montana 69.2 82.1 52.2 86.4 45.2 87.0
Nebraska 61.2 42.0 53.1 39.5 74.7 53.8
Nevada 45.8 39.2 31.7 58.7 56.1 69.6
New Hampshire 21.9 46.0 1.6 44.6 8.0 31.6
New Jersey 55.8 25.2 NA NA NA NA
New Mexico NA NA 35.6 16.8 54.1 29.3
New York 61.1 63.6 38.5 58.8 23.1 58.4
North Carolina 56.2 45.5 55.0 30.9 45.1 30.3
North Dakota NA NA NA NA NA NA
Ohio 47.8 39.8 49.2 51.5 35.1 65.4
Oklahoma 36.9 16.1 4.2 31.4 NA NA
Oregon 46.8 98.3 9.8 95.2 38.5 96.1
Pennsylvania NA NA 26.3 21.8 20.7 24.9
Puerto Rico NA NA NA NA NA NA
Rhode Island NA NA 51.1 32.4 77.0 94.7
South Carolina 24.9 40.2 48.5 60.9 61.7 78.1
South Dakota NA NA NA NA NA NA
Tennessee 46.0 52.4 4.6 39.1 5.2 44.3
Texas 55.4 34.3 47.9 44.3 48.2 61.0
Utah 63.7 64.1 47.5 49.7 NA NA
Vermont NA NA NA NA NA NA
Virgin Islands NA NA NA NA NA NA
Virginia 65.6 19.4 51.8 26.5 NA NA
Washington 66.0 18.6 52.2 45.5 47.8 55.3
West Virginia 61.3 49.0 46.8 37.2 51.1 25.9
Wisconsin 39.9 51.3 0.0 39.2 20.1 55.8
Wyoming 54.9 63.9 4.9 65.8 0.0 90.7
National Average   34.3   35.4   54.7

Tables 2 and 3 also show the participation rates states achieved during the initial years of the TANF program (FY 1997 and FY 1998) for the overall and the two-parent rate, respectively. Table 4 shows the rates achieved during the last year of the JOBS program (FY 1996). As shown, under both JOBS and TANF, all states met the participation requirement for the overall rate (adjusted by the caseload reduction credit under TANF) in the years examined in this report.(2)  However, under both JOBS and TANF, states experienced much more difficulty meeting the more stringent two-parent rates. Under JOBS, roughly half of the states (26) met the two-parent requirements. Under TANF, 16 states met their adjusted two-parent rate in FY 1997 and 28 states met this rate in FY 1998.(3)

Table 4.
JOBS Overall and Two-Parent Participation Rates, FY 1996

(in percents)
State  Overall Rate
(Target Rate = 25 Percent)
Rate Achieved
Two-Parent Rate
(Target Rate = 60 Percent)
Rate Achieved
Alabama 56.1 35.9
Alaska NA 48.3
Arizona 49.4 55.4
Arkansas 20.1 29.3
California 27.1 39.0
Colorado 22.2 61.1
Connecticut NA 84.6
Delaware 14.4 21.4
DC NA NA
Florida 81.8 100.0
Georgia 40.8 71.4
Guam 20.0 16.9
Hawaii 21.1 8.1
Idaho 53.0 61.7
Illinois 29.4 67.8
Indiana 22.5 34.9
Iowa 37.5 75.1
Kansas 33.0 60.1
Kentucky 31.8 90.0
Louisiana 33.5 77.8
Maine 35.4 74.7
Maryland 26.1 34.6
Massachusetts 33.5 65.3
Michigan 29.5 51.5
Minnesota 25.3 38.4
Mississippi 24.6 11.6
Missouri 37.7 67.2
Montana 30.2 65.5
Nebraska 73.2 51.9
Nevada 29.6 67.8
New Hampshire 68.1 58.6
New Jersey 26.7 66.7
New Mexico 36.4 67.8
New York 27.7 54.2
North Carolina NA 18.0
North Dakota 52.2 75.6
Ohio 42.9 48.0
Oklahoma 29.6 24.6
Oregon 76.4 35.2
Pennsylvania 32.8 72.5
Puerto Rico 27.4 NA
Rhode Island 22.5 69.6
South Carolina 24.2 39.3
South Dakota 76.9 83.0
Tennessee 36.2 60.4
Texas 28.7 41.2
Utah 55.2 87.1
Vermont 22.0 60.6
Virgin Islands 14.8 NA
Virginia 34.8 23.7
Washington 65.8 49.7
West Virginia 26.1 25.8
Wisconsin 60.6 76.9
Wyoming 68.4 81.7
National Average 33.1 NA

Overall, while TANF requires higher levels of participation to meet both the overall and two-parent rate than required under JOBS, the participation requirement for TANF is moderated in many states by the caseload reduction credit. As explained in detail below, because of the differences in the way participation rates are defined under JOBS and TANF, it is very difficult to compare the participation rates achieved under JOBS to those achieved under TANF.

Who Must Participate?

A key issue in the calculation of participation rates is defining who is required to participate — that is, who is counted in the denominator of the participation rate. As discussed below, the TANF program requires participation from a broader segment of adults receiving assistance than required under JOBS.

It is important to note that TANF funding covers both cash assistance and welfare-to-work programs and services and can be used for a wider range of cash and non-cash assistance than the cash assistance program (Aid to Families with Dependent Children (AFDC)) and job training program (JOBS) that it replaced. However, with regard to the participation requirements, the TANF regulations specify that only families receiving TANF "assistance" are included in the denominator of the participation rate. "Assistance" includes cash payments, vouchers, and other benefits designed to meet a family’s ongoing needs, as well as supportive services provided to families who are not employed.(4) Thus, the participation requirements in TANF generally apply to a similar population, i.e., those receiving cash assistance rather than other types of services, as they did under JOBS.

The JOBS program mandated participation in program activities for adults in both two-parent and single-parent families receiving cash assistance — but only for a portion of these populations. Under JOBS, certain groups of individuals who received cash assistance — particularly those who were in circumstances that made participation more difficult — were "exempted" from the participation requirement. As summarized in Table 5, exemptions were made for those individuals who were: ill, incapacitated, or of advanced age (over age 60); needed in the home because of illness or incapacity of another family member; the caretaker of a child under age three (or, at state option, under age one); employed more than 30 hours per week; a dependent child under age 16 or attending an education program full-time; women in the second and third trimester of pregnancy; and residing in an area where the (JOBS) program was not available. For two-parent families, the exemption due to the age of the child applied to only one parent.

The TANF program has a broader approach to defining the participation mandate than the JOBS program. Unlike JOBS, the approach under TANF is to exempt as few individuals as possible from welfare-to-work activities. Thus, while TANF does allow certain individuals who receive assistance to be exempted from the work requirements, fewer exemptions are allowed than under JOBS. As shown on Table 5, the following exemptions are allowed in TANF:

Table 5
Exemptions from Welfare-to-Work Activities Under the JOBS and TANF Programs
Exemptions in the JOBS Program Exemptions in the TANF Program
  • Illness
  • Incapacitated
  • Over age 60
  • Needed in the home because of illness or incapacity of another family member
  • Caretaker of a child under age three (or, at state option, under age one)
  • Employed more than 30 hours per week
  • Dependent child under age 16 or attending an education program full-time
  • Women in the second and third trimester of pregnancy
  • Residing in an area where the program was not available
  • At state option, single parents with a child under age one
  • Disabled parents in two-parent families
  • Individuals with a history of domestic violence. (If a state fails to meet the required participation rates, the calculations will be adjusted to exclude these cases before a penalty is applied.)

TANF also allows exemptions from the participation requirements for states who had work program waivers in effect when PRWORA was enacted. States that had waivers for any of a number of work program provisions are allowed to continue their pre-TANF policies (if they are inconsistent with TANF) until the waiver expires. States that received waivers in one or more areas of their work program — specifically, allowable work activities, hours, exemptions, and/or sanctions for noncompliance — that are inconsistent with TANF are allowed to continue operating under their prior rules in all of these areas. Thus, states with pre-existing work program waivers can continue with the JOBS exemptions or other exemptions policies they established through a waiver. States in these circumstances can exempt a broader range of families from welfare-to-work activities than would otherwise be allowed under TANF. In addition, one state (Vermont) claims that waiver inconsistencies exempt all cases from the participation rates.

Another issue regarding the denominator of the participation rate under TANF concerns the treatment of families who have been sanctioned. Under TANF, families who have had their TANF grants reduced due to a sanction are subtracted from the total number of families included in the denominator — unless they have been sanctioned for more than three of the past 12 months.

Overall, as a result of these different approaches regarding who is required to participate and who is counted in the denominator of the participation rate, the TANF program extends its participation mandate to a much broader population. Under the JOBS program, the adults in approximately 43 percent of families receiving cash assistance were not exempt and therefore were subject to the participation mandate in FY 1995 (Committee on Ways and Means, 1997). In contrast, this proportion doubles under TANF — approximately 86 percent of the adults receiving assistance were subject to the participation requirements in TANF in FY 1998.(6)

For How Many Hours are Individuals Required to Participate?

Another critical element in defining participation rates is establishing for how many hours and in what types of activities individuals must participate in the welfare-to-work program each month in order to count toward the rate — that is, to be counted in the numerator of the rate. This section discusses how long individuals are required to participate, while the next section discusses the types of activities required. As discussed below, JOBS and TANF established different rules regarding who is counted as a participant based on the number of hours individuals were required to participate each week (summarized in Table 6).

Table 6
Weekly Hours of Participation Required Under the JOBS and TANF Programs
Hours Per Week Required in the JOBS Program Hours Per Week Required in the TANF Program
  • Scheduled for program activities for an average of 20 hours per week; must attend at least 75 percent of the scheduled hours.
  • Maximum of 20 hours per week required for single parents with child under age six
  • Hours (actual not scheduled) required increases from 20 hours per week in FY 1997 to 25 hours per week in FY 1999 to 30 hours per week in FY 2000 and beyond for overall rate
  • 20 hours per week required for single parents with child under age six
  • 35 hours per week required for two-parent families

In JOBS, to count toward the overall rate, all individuals who could possibly be counted as participants must be scheduled for program activities for an average of 20 hours per week.(7)  To actually be counted as a "participant" these individuals must attend at least 75 percent of their scheduled hours. A parent of a child under age six who is personally providing care to the child can be required to participate only 20 hours per week.

In TANF, for the overall work participation rate, the number of hours (actual not scheduled) required to meet the participation requirement increased from 20 hours per week in FY 1997 to 25 hours per week in FY 1999 to 30 hours per week in FY 2000 and beyond. However, the number of required hours for a single parent with a child younger than six years old remains at 20 hours per week throughout the period covered by the legislation. Hours of participation may be averaged across weeks in a month for any given participant, but may not be averaged across participants.

To qualify as a participant for the two-parent rate, 35 hours of participation are required. This number remains constant throughout the TANF authorization period, but it may be met by a combination of effort between the two parents. However, if a two-parent family is receiving federally funded child care assistance, then the two parents together must meet a 55 hour per week requirement.

States with a prior work program waiver can choose to maintain the hourly requirements established by JOBS or by their waiver (whichever is applicable). Once the waiver expires, these states will be required to meet the hourly requirements established by TANF.

What Activities Count Toward the Participation Rate?

A final element in determining whether an individual counts toward a state’s participation requirement is examining the types of activities recipients must participate in. As with the other factors, the two programs take very different approaches regarding what types of activities individuals can participate in to count toward the rate. While the JOBS program took a relatively expansive approach regarding what counted, TANF narrows the type of activities and requires participation in more work-focused activities.

For the JOBS overall rate, a wide range of employment-related, education, and training activities counted toward the participation requirement. As summarized in Table 7, these included job development and placement; job skills training; educational activities (including high school and equivalency programs, basic and remedial education, and English as a Second Language (ESL)); group and individual job search (for up to eight weeks); community work experience; work supplementation; on-the-job training; and post-secondary education. Non-exempt custodial parents under the age of 20 who had not completed high school (or its equivalent) were required to participate in educational activities. Individuals who entered a job were also counted as participants if they engaged in a JOBS activity during the month of job entry or during the preceding month.

Table 7
Activities that Count Toward the Participation Requirement Under the JOBS and TANF Programs
Countable Activities in the JOBS Program Countable Activities in the TANF Program
  • Job development and placement
  • Job skills training
  • Educational activities (including high school and equivalency programs, basic and remedial education, and English as a Second Language (ESL))
  • Group and individual job search (for up to eight weeks)
  • Community work experience
  • Work supplementation
  • On-the-job training
  • Post-secondary education
  • Employment for those engaged in a JOBS activity during the month of job entry or during the preceding month.
At least 20 hours (30 hours for two-parent families) must be spent in the following:
  • Unsubsidized employment
  • Subsidized employment
  • Work experience
  • On-the-job training
  • Job search and job readiness activities
  • Community service programs
  • Vocational educational training (for up to 12 months per person)
  • Provision of child care services to a person participating in community service

The remaining required hours may be in the above or any of the following activities:

  • Job skills training directly related to employment
  • Education directly related to employment (for those with no high school diploma)
  • Secondary school or program leading to a certificate of general equivalence (for those with no high school diploma)

The requirements for meeting the two-parent rate under JOBS were more stringent. JOBS required individuals in these families to participate 16 hours per week in a work supplementation program, a community work experience program, on-the-job training, or other types of work programs. For both the overall and two-parent rates, individuals who were working less than 30 hours per week were not counted in the rates at all under JOBS, while those working more than 30 hours per week were exempted from the rates.

The TANF statute is much more prescriptive with respect to the types of activities that count toward a state’s participation rate. As summarized in Table 7, in order to count a participant for a month in any year, at least 20 hours per week for all families and 30 hours per week for two-parent families(8) must be spent in one or more of the following activities; unsubsidized employment, subsidized private or public sector employment, work experience, on-the-job training, job search and job readiness activities (for up to six weeks total per individual — or 12 weeks if the state meets the definition of a needy state(9) — but not for more than four consecutive weeks), community service programs, and vocational educational training (for up to 12 months per person), and the provision of child care services to a person participating in community service.

The remaining required hours may be in any of the above or the following activities: job skills training directly related to employment and, for those who do not have a high school diploma or equivalent, education directly related to employment or satisfactory attendance in a secondary school or in a course of study leading to a certificate of general equivalence. Teen heads of household can count toward the participation rate by maintaining satisfactory attendance in high school or the equivalent (regardless of the number of hours) or by participating in education directly related to employment for at least 20 hours per week.

The TANF program has specific rules that limit the number of individuals who can count toward the participation requirement by attending education and training activities. For FYs 1997-1999, no more than 30 percent of those individuals who count toward the rate can do so by participating in vocational educational training. In FY 2000 and thereafter, no more than 30 percent of those counted can meet the requirements by either participating in vocational education training or being a teen head of household in school.

Similar to other TANF provisions, states with one or more work program waivers (see above) in effect prior to the passage of the TANF can continue counting the activities allowed under JOBS or the activities allowed through their waiver. Once the waiver expires, however, states will be required to use the definition of program activities established by TANF.

It should be noted that there is some overlap in the types of activities allowed under JOBS and TANF — such as job search and on-the-job training. In some cases the overlap is not always clear because different terms are used for activities that are actually very similar. For example, both programs allow subsidized employment, work experience, and vocational training to count toward the participation requirement — although in JOBS these activities were called work supplementation, community work experience, and job skills training. In both programs, states are given discretion over how the specific activities are defined.

Overall, the TANF law narrows the type of activities that count toward the participation rate and focuses those that do count on work and work-related activities. Education and training activities — a major component in the JOBS program — only count toward the TANF participation rate in limited circumstances. Unsubsidized employment — which did not count toward the JOBS participation requirement — is a key activity under TANF. Under TANF, over 80 percent of the welfare-to-work program participants were in work or work-related activities (unsubsidized or subsidized employment, work experience, or on-the-job training) compared to seven percent in JOBS.(10)  In contrast, in JOBS about 47 percent of the program participants were involved in education and training activities (vocational and jobs skills training, high school, post secondary education, remedial education, ESL, or education related to employment), while in TANF only 11 percent of the participants received these services (U.S. Department of Health and Human Services, 1999, and Administration for Children and Families, 1997). Clearly, TANF has had a significant impact on types of activities provided in welfare-to-work programs.

Assessment of the Change in Participation Requirements Under JOBS and TANF

While the previous sections of this paper described how participation is measured under the JOBS and TANF programs, the paper concludes by discussing factors that may influence a state’s ability to achieve the required participation rates and provides an assessment of how the participation requirements changed under the two programs.

An important factor in a state’s ability to achieve the expected level of participation is the economy. Increases or decreases in the unemployment rate can affect welfare caseloads by increasing or decreasing the need for cash assistance. This in turn affects the number of individuals states will have to involve in activities to meet the minimum participation requirements. When the economy declines, welfare caseloads tend to increase (Blank, 1997). This occurred after the passage of the Family Support Act in 1988. In part due to an economic recession, the number of families on welfare grew by 38 percent — from 3.7 million in 1988 to 5.1 million 1994. As caseloads increased, states had to involve more individuals in work activities to meet the required participation rates.

In contrast, the TANF statute passed in the midst of an economic recovery and the strong economy has played at least a partial role in the recent decline in welfare caseloads (Council of Economic Advisors, 1997 and 1999). As of March 1999, 2.7 million families were receiving TANF assistance. As a result of this decline, states have been required to involve fewer individuals in work activities to meet the participation requirements than they would have if caseloads had been higher. If economic conditions worsen and welfare caseloads increase, states may face greater challenges in future years when the target rates are higher and the caseload reduction credit is smaller.

Another way the economy can affect a state’s ability to achieve participation rates is the availability of jobs in the labor market — particularly when work counts as an activity as it does under TANF. A lack of unsubsidized jobs suitable for individuals leaving welfare will require states and localities to develop more program-based options (such as work experience positions) or to involve individuals in job skills training options in order to meet participation rates. This can increase program costs and place more demands on program managers and line staff. Another related issue is the lack of unskilled jobs in some local economies. In this case, jobs may be available but they may not be in the low-skilled labor market in which most welfare recipients find jobs.

A second factor that can affect the ability of states to meet minimum participation requirements is the composition of the welfare caseload — particularly the proportion of the caseload defined as "hard-to-serve". Welfare recipients with more employment barriers — such as low employment skills, limited work experience, and/or problems with domestic violence and substance abuse — may have more difficulty sustaining participation in program activities. States with a higher proportion of these types of individuals in their caseload have greater difficulty meeting participation requirements. Interestingly, because of the dramatic caseload decline experienced recently, it appears that the most employable recipients have found jobs and that those remaining on the caseload have more barriers to employment. This result may mitigate somewhat the positive effect that falling caseloads have on a state’s ability to achieve the minimum participation rates.

A third factor affecting the ability of states to meet the required participation rates is the availability of support services — particularly child care and transportation. Studies of welfare-to-work programs have found that problems in providing child care resulted in lower participation levels (Hamilton and Scrivener, 1999). Child care problems can result from a shortage of slots (or from a shortage of certain types of slots such as infant care or care during non-traditional or irregular hours), from inadequate resources to provide child care subsidies, and from unreliable arrangements with no backup options. Similarly, assistance in obtaining reliable transportation is also necessary if individuals are to participate in activities on a regular basis — particularly in areas with limited public transportation.

Finally, policies that encourage work by making work pay — such as earnings disregards — can increase the ability of states to achieve participation rates when works counts toward the requirement. These financial incentives encourage work by allowing workers to remain on welfare after their earnings would otherwise have exceeded eligibility limits. However, states with low grant levels may have more difficulty in meeting participation rates — particularly when work counts toward the rate. In states with low monthly assistance grants (and without generous income disregards), any job that meets the hourly threshold for participation is likely to make a worker ineligible for assistance.

In addition, some types of program approaches may enhance the ability of states to achieve participation rates. Research has shown that programs that emphasize skill development can result in higher participation rates, largely because activities are more seamless (Hamilton and Scrivener, 1999). When people move from one activity to another in a welfare-to-work program, the "in-between" periods can cause monthly participation rates to drop. Because education and training activities tend to be longer-term than job readiness and job search activities, programs that incorporate these activities more extensively may be able to achieve higher monthly participation rates more easily.

Overall, compared to the JOBS program, the TANF program has resulted in a participation mandate covering a much broader range of welfare recipients and has established stronger incentives to enroll welfare recipients in work-focused activities. In some respects, TANF made achieving minimum participation rates more difficult for states — particularly because of the broader mandate, the more limited range of activities that count toward participation, and the higher target rates. However, this has been moderated by the caseload reduction credit that has reduced target rates, by declining caseloads that require states to involve fewer individuals in program activities to meet the rates, and by state waivers that in some cases have temporarily narrowed the proportion of the caseload that is required to participate in program activities and allowed a broader range of activities to count toward the requirement.

Compared to JOBS, TANF has resulted in a slight overall increase in the number of welfare recipients participating in welfare-to-work activities. In FY 1996 approximately 665,000 welfare recipients participated in JOBS activities, while in FY 1998 almost 700,000 individuals participated in work or work-related activities under TANF (U.S. Department of Health and Human Services, 1999, and Administration for Children and Families, 1997). However, as discussed above, these numbers are not strictly comparable because participation is defined in different ways under the two programs. For example, individuals who were working while receiving cash assistance under JOBS are not included in this number (but they are in TANF) while in TANF some individuals participating in education and training may not count toward the rate (but they did in JOBS).

These figures also reflect the decline in the number of families receiving cash assistance. While the number of program participants is close in absolute terms, a higher proportion of the cash assistance caseload is now participating in welfare-to-work activities. The number of JOBS participants in FY 1996 represents 14 percent of the number of families on welfare (including families that were exempted from the participation requirement). Under TANF, 22 percent of all families receiving assistance (again, including families that were exempted) were involved in work or work-related activities in FY 1998.

In sum, this paper has shown that participation requirements in welfare-to-work programs are very sensitive to how they are defined as well as to outside factors such as the state of the economy and other program features, including the availability of support services and grant and earnings disregard levels. Thus, it is important to consider all these factors when comparing participation rates across states and from one program to another.

Endnotes

1. The participation requirement for two-parent families in JOBS did not apply in the initial years of the program; it did not phase-in until FY 1994.  The JOBS statute specified rates for two-parent families through 1998, however, these rates were superceded by the TANF law beginning in FY 1997.

2. None of the territories met this participation requirement for TANF in FY 1998.

3. The two-parent requirements do not apply in eleven states and territories. Six states — alabama, Florida, Georgia, Hawaii, Maryland, and New Jersey — served two-parent families through a separate state program and thus the TANF two-parent participation requirements do not apply.  North Dakota, Puerto Rico, South Dakota, and the Virgin Islands do not serve two-parent families.  Vermont exempts all families from participation requirements due to a waiver inconsistency (see Section III of this Appendix).

4. "Assistance" does NOT include other benefits such as non-recurrent, short-term benefits, work subsidies, counseling and supportive services provided to families who are employed.

5. The Family Violence Option (FVO) in the PRWORA statute permits a state to waive program requirements for a victim of domestic violence if complying with the requirements would make it more difficult for the victim to escape violence or would unfairly penalize the individual. Under the FVO, the state must also develop a system to screen for victims of domestic violence and refer them to appropriate counseling and support services. HHS will determine that a state has reasonable cause for failing to meet the work participation rates or to comply with the five-year limit on federal assistance if its failure was due to its provision of good cause domestic violence waivers.

6. Calculations from Table 3:5: TANF Work Activities, Excluding Waivers, for Families Meeting the All-Family Work Requirements, Fiscal Year 1998, in U.S. Department of Health and Human Services, 1999. Child-only cases were not included.

7. This means some individuals could be scheduled for activities that lasted 10 hours per week and others could be scheduled for activities that lasted 30 hours per week. The JOBS regulations required that the number of scheduled hours across all participants average 20 hours per week.

8. And 50 hours for those with a 55-hour requirement.

9. Needy states are defined by high unemployment or increased participation in the Food Stamp program.

10. Calculations from Table 3:5: TANF Work Activities, Excluding Waivers, for Families Meeting the All-Family Work Requirements, Fiscal Year 1998, in U.S. Department of Health and Human Services, 1999, and Administration for Children and Families, 1997.


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