What Works in Work-First Welfare: Designing and Managing Employment Programs in New York City

Foreword

xv Foreword In October 2004,Andy Feldman began doing the fieldwork for this book in the welfare-to-work programs of New York City. The welfare system in New York City, as in the nation as a whole, was in the midst of a massive transformation . The 1996 federal welfare reform legislation had promised to “end welfare as we know it,” and in many ways it had succeeded. Nationally, welfare rolls fell by two-thirds between 1994, their peak, and 2005. In New York City, the number of people receiving welfare fell from 1.1 million in the spring of 1995 to 420,000 in March 2005 when Andy was finishing his fieldwork. Caseloads have continued to fall, even in the midst of the serious recession of 2007–2009. Nationally, the Temporary Assistance to Needy Families Program (TANF, formerly Aid to Families with Dependent Children or AFDC) average monthly caseload was 4 million in 2009, down from 14.2 million in 1994. In New York City, the caseload continued to fall after 2005, and was at 350,000 in early 2010. These dramatic caseload declines inspired a small army of researchers who attempted to explain them. The resulting analyses have not been very satisfying . The declines were far larger than anyone would have predicted from previous history. The econometric studies established the importance of expanding the Earned Income Tax Credit and child support enforcement activities, but they mainly focused on the effects of an extremely good economy and tight labor market. The fact that caseloads have increased very little and in some places continued to fall during the 2007–2009 recession casts some doubt on the power of this latter explanation. Perhaps in desperation, researchers also hypothesized that a change had taken place in the “culture” of the welfare system and in the perceptions of recipients and potential recipients about welfare. This book is an important contribution to our understanding of what was in fact going on in the welfare system and in related work programs after welfare reform. New York City’s welfare system is unusual in many ways. The size, scale, and diversity of the city are huge. Moreover, New York City is governed by New York State’s constitutional guarantee of assistance to the needy and by legislation and court decisions that are unusually generous. There is no effective time limit for welfare receipt in New York and only modest financial sanctions for noncompliance with rules. New York guarantees assistance to all, not just to families with children, and the New York caseload is thus unusual in its high proportion of men and of nonparents. But these very differences make New York an interesting place to study what goes on in welfare offices, where the attitudes and behaviors of the workers are almost by definition more xvi important than the federal rules, and where the diverse caseload increases the relevance of the findings to employment programs generally. New York City refers all employable applicants to work programs and assigns them randomly to sites, which is a boon for researchers. All the programs employ a basic “work-first” strategy, which means that their goal is to place participants in jobs as quickly as possible. This book documents how that strategy is put into practice, how variations on it are developed by individual programs, and how well programs do in achieving their goals. The programs themselves differ in their demographics, size, for-profit or nonprofit status, and structure of performance incentives, as well as in management style and emphasis on different tactics within the basic work-first strategy. Because New York City also has a reasonably good system for tracking participants, it provides an opportunity to study the effects of this variation. The most sobering finding of this study is undoubtedly the overall placement rate. Of the 20,677 welfare recipients assigned to employment programs, the subjects of this study, only 6 percent were placed in jobs and still employed six months after placement. But of those who showed up and persisted in the program (20 percent of those assigned), almost two-thirds were placed in jobs and of those almost half were employed six months later. This study does not help us understand the 32 percent who never showed up at all or the additional 48 percent who showed up at least once but did not complete the program. Their experiences, like those of the programs’ successes, must be part of the explanation for the caseload declines that...