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Of all the fundamental changes that have swept through the nation's welfare system over the past several years, the introduction of time limits on welfare receipt is one of the most dramatic. Between 1993 and mid-1996, more than 30 states received federal waivers to implement some type of time limit on welfare receipt in at least part of the state. The Personal Responsibility and Work Opportunity Reconciliation Act, signed by President Clinton in August 1996, gave states vast new flexibility in redefining welfare but also imposed new restrictions, including a restriction on using federal funds to provide assistance to most families for more than a total of five years. (Source: MDRC).
Selected Summary Findings in Brief
The following findings are drawn from two impact studies (conducted by MDRC) that measure the impacts of time limits.
Reaching time limits
- Florida: less than 1/4 of the program group received 24 or 36 months of welfare within 4 years after enrollment; of those who received 24 or 36 months, about 2/3 reached the time limit (most others received medical exemptions ); of those who reached the time limit, nearly all had benefits canceled and no last-resort jobs were provided; individuals reaching the time limits were more likely to be living in subsidized housing, long-term recipients, and African-American
- Connecticut: almost 1/2 the program group reached the 21-month time limit within 3 years; almost all those who were not employed when they reached the time limits received at least one 6 month extension; of those who reached the time limit, more than 60% received at least one extension; individuals who reached the time limit were more likely to be in subsidized housing, long-term recipients, and have 3 or more children
Earning Impacts
- Florida and CT: Effects prior to time limits may either be anticipation or effects other than time limits; time limits did not produce any major effects - the program group has slightly higher earnings in the beginning but the control groups were nearing their program group counterparts
AFDC/TANF Impacts
- Florida: no major differences between program and control groups
- CT: Program group has higher payments (because of the program earning disregard) prior to time limit but trend reversed after time limit
Income Impacts
- Florida FTP and CT: Initial increase in income on the program group but no difference between groups after time limit
Subgroups
- FTP: Employment and income gains were concentrated among the least disadvantaged subgroups; some disadvantaged clients lost income as a result of the program
- CT: Employment gains were concentrated among the most disadvantaged subgroups; small group of families lost income
Children
- FTP had few effects on parenting or child well-being on elementary school-aged children
- FTP had few negative impacts on school-related outcomes for adolescents
- Reduced supervision may account for negative impacts seen among school-aged children from least disadvantaged families
- CT Jobs First had a few positive impacts on the behavior of elementary school children, concentrated among 5-8 year olds, and had mixed effects for adolescents
After time limit
- FTP: About 1/2 were already working when they reached the time limit; employment rate remained consistent after exit; many former recipients relied heavily on family, friends, and public assistance; most families struggled financially after the time limit, but there was no evidence of increased hardship relative to "voluntary" welfare leavers
- CT: Almost all those whose benefits were canceled due to time limit were employed; employment rate decreased over time but remained quite high; time limit leavers were more likely to receive Food Stamps than other leavers; Time limit leavers appear to have higher income from earnings and public assistance than other leavers
Outstanding questions
- How will terminated families fare in the long term?
- How would a weaker labor market affect outcomes?
- Do the outcomes change for urban populations?
- Will states respond differently to the federal 60-month limit than to shorter state limits?
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