Welfare Reform in Persistent Rural Poverty: Dreams, Disenchantments, and Diversity

9. Welfare Reform in Persistent Rural Poverty

Despite chronically high levels of poverty and unemployment, the pockets of persistent poverty we studied experienced significant declines in welfare caseloads over the last decade. South Dakota, Texas, and Mississippi all received waivers for their afdc programs and began implementing work requirements and other reforms in some locales before the federal prwora reforms were enacted. All four states had declining welfare rolls between 1992 and 1996, including Kentucky, although among our focus counties Todd and Starr had increases over that period. Following the passage of prwora, all of our focus counties exhibited significant caseload declines, some of which approached the 60 percent decline nationally. At first glance, this fact seemed astonishing, given their poor overall economic conditions and extreme labor demand deficiencies. It became less surprising as we began to understand the complex institutional factors underlying household survival in these areas and the limited role of cash welfare assistance. Economic Conditions There is little evidence that the dramatic declines in welfare participation are attributable to significantly improved economic conditions. Leaders of the counties in our study universally identified the need for greater and broader economic development in their regions before welfare reform’s stated goal of decreasing welfare “dependency” could be realized. While poverty rates in the focus counties declined during the 1990s, they remained astronomical in 2000 compared to the U.S. rate and were only slightly better in most of the NINE Welfare Reform in Persistent Rural Poverty counties than they were in 1980. Per capita income in the counties remained approximately one-half the per capita income for their respective states, and their economies remained undiversified and highly vulnerable to singlesector job loss and declines in government jobs and spending. While there were some increases in employment in every county except Holmes, Mississippi , these increases were in lower-paying, less stable service sectors, with ongoing losses in manufacturing jobs for most of the counties. It is also evident that although these places are remote, they are nevertheless strongly affected by changing global economic forces. This is not surprising when one considers the integral roles played by the Delta, the Valley, and Appalachia historically in the development of the national economy. Nor is it surprising when we realize that the present movement of manufacturing off shore is the result of a process which began in the 1960s with the movement of manufacturing processes from the unionized North to the rural South. Losses in manufacturing in Mississippi, Texas, and Kentucky were all associated with the implementation of nafta and the broader movement of capital investments in manufacturing to foreign countries with even lower labor costs. On the other hand, the location of the Texas counties at the Mexico border allowed them alone to reap some benefits from increased internationalization through their retail and service sectors. Full Employment It is readily apparent that people were not leaving welfare for full-time, year-round employment. The nature of these rural labor markets increases the likelihood that whatever formal employment is found will be for low pay, no benefits, and limited duration. For example, of those people employed in these counties in 2000, between 75 percent and 85 percent were employed full time, but only between 25 percent and 50 percent were employed yearround , full time. In several counties, the concern was expressed that tanf participants were competing with other poor families looking for work, especially where manufacturing jobs had declined significantly. Overall, the job trend is toward lower-end, minimum-wage, service sector work. Among the former participants interviewed who were working, most were making minimum wage or slightly above minimum wage. However, the self-sufficiency standards for these counties indicate that something between $11 and $15 an hour is needed to meet the needs of a single parent with two school-aged children (Pearce 1997, 2000a, 2000b, 2003). 210 Welfare Reform in Persistent Rural Poverty Reliance on Social Networks and the Everyday Economy All the regions in this study demonstrated the tremendous role of extended family and friends in covering shortfalls created by underemployment and lost welfare benefits. It is also apparent, however, that family supports are limited, vulnerable, and fragile. There are also potential problems within these networks, including unresolved conflicts and substance abuse. Nonetheless , these social networks form the foundation of what we have termed the everyday economy. All these pockets of persistent rural poverty shared the phenomenon of families making ends meet within an “everyday...