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[IWS] CRS: WELFARE, WORK, AND POVERTY STATUS OF FEMALE-HEADED FAMILIES WITH CHILDREN: 1987-2013 [21 November 2014]

IWS Documented News Service

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Institute for Workplace Studies-----------------Professor Samuel B. Bacharach

School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies

Cornell University

16 East 34th Street, 4th floor--------------------Stuart Basefsky

New York, NY 10016 -------------------------------Director, IWS News Bureau

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This service is supported, in part, by donations. Please consider making a donation by following the instructions at http://www.ilr.cornell.edu/iws/news-bureau/support.html

 

Congressional Research Service (CRS)

 

Welfare, Work, and Poverty Status of Female-Headed Families with Children: 1987-2013

Thomas Gabe, Specialist in Social Policy

November 21, 2014

https://fas.org/sgp/crs/misc/R41917.pdf

[full-text, 117 pages]

 

Summary

Eighteen years have passed since repeal of what was the nation’s major cash welfare program

assisting low-income families with children, the Aid to Families with Dependent Children

(AFDC) program, and its replacement with a block grant of Temporary Assistance for Needy

Families (TANF). This report focuses on trends in the economic well-being of female-headed

families with children, the principal group affected by the replacement of AFDC with TANF.

Female-headed families and their children are especially at risk of poverty, and children in such

families account for well over half of all poor children in the United States. For these reasons,

single female-headed families continue to be of particular concern to policymakers. The report

details trends in income and poverty status of these families, prior and subsequent to enactment of

the 1996 welfare reform law and other policy changes. The report focuses especially on welfare

dependency and work engagement among single mothers, a major dynamic that welfare reform

and accompanying policy changes have attempted to affect. It also examines the role of programs

other than TANF in providing support to single female-headed families with children.

 

CRS analysis of 27 years of U.S. Census Bureau data shows that there has been a dramatic

transformation with regard to welfare, work, and poverty status of single mothers. The period has

seen a marked structural change in the provision of benefits under a number of programs that

contribute to the fabric of the nation’s “income safety net.” In turn, single mothers’ behavior has

changed markedly over the period; more mothers are working and fewer are relying on cash

welfare to support themselves and their children.

 

In the years immediately preceding 1996 welfare reform, and in the years since, the nation’s

income safety net has been transformed into one supporting work. Cash-welfare work

requirements, the end of cash welfare as an open-ended entitlement by limiting the duration that

individuals may receive federally funded benefits, and expanded earnings and family income

supplements administered through the federal income tax system have helped to change the

dynamics between work and welfare. The transformed system has helped to both reduce single

mothers’ reliance on traditional cash welfare and reduce poverty among their children.

Poverty under the official U.S. poverty measure, which is based on pre-tax cash income, shows

that since 2000, which marked a historical low, the poverty rate among single mothers increased

in step with two recessions. By 2010, the official poverty rate for single mothers had reached a

post-2000 high, and remained at that level through 2012, before falling somewhat in 2013. In

2013, the official poverty level was still below pre-1996 welfare reform levels, despite two

recessions since 1996.

 

Using a more comprehensive income definition than that used by the official poverty measure

indicates that the increase in poverty among single mothers and their children over the past 13

years has been substantially mitigated by Food Stamp/SNAP benefits and work-related

refundable tax credits—benefits not captured by the “official” poverty measure. Use of an

expanded income poverty measure that includes these benefits highlights effects of congressional

action that helped reduce child poverty amidst, and subsequent to, the most severe recession since

the Great Depression.

 

The role of work-conditioned benefits, and the provision of traditional cash welfare, will likely

continue to garner attention, in part contingent on the nature and pace of economic recovery, and

federal and state budget pressures.

 

Contents

Introduction ...................................................................................................................................... 1

A Road Map ..................................................................................................................................... 2

Female-Headed Families with Children—A Policy Concern .......................................................... 3

Policy Landscape on the Eve of 1996 Welfare Reform ................................................................... 6

Welfare Dependency as a Political Theme ................................................................................ 7

EITC Expansions—“Making Work Pay” .................................................................................. 8

TANF and Other Policies in the Post-AFDC Era ............................................................................ 9

Other Federal and State Policies that Encourage Work ........................................................... 10

Child Support Enforcement ..................................................................................................... 11

Policies Addressing Marriage and Childbearing ..................................................................... 12

Policy Responses to Changing Economic Conditions ................................................................... 12

Tax Rebates, Reductions, and Credits ..................................................................................... 13

Unemployment Insurance Benefits ......................................................................................... 14

Supplemental Nutrition Assistance Program (SNAP/Food Stamp) Benefits .......................... 15

Other Social Policies ............................................................................................................... 15

Welfare, Work, and Poverty Status of Female-Headed Families with Children ............................ 16

Number of Families Headed by Single Mothers ..................................................................... 19

Incidence of Poverty by Mothers’ Marital Status .................................................................... 20

Poverty and Cash Welfare Receipt among Single Mothers ..................................................... 21

Work, Poverty, and Cash Welfare Receipt of Single Mothers ................................................. 22

Single Mothers’ Employment ........................................................................................................ 23

Unemployment Rates Across the Business Cycle ................................................................... 25

Poor Single Mothers’ Work and Welfare Status ...................................................................... 26

Receipt of Selected Benefits by “Earnings Poor” Female-Headed Families with Children .......... 28

Earned Income Tax Credit (EITC) .......................................................................................... 28

Supplemental Security Income (SSI) ...................................................................................... 29

Unemployment Insurance (UI) Benefits .................................................................................. 30

Food Stamp/Supplemental Nutrition Assistance Program (SNAP) Benefits .......................... 30

Additional Child Tax Credit (ACTC) ...................................................................................... 31

Anti-Poverty Effects of Cash Income, Taxes, and Transfers on Poverty—Female-Headed Families with Children ....................................... 31

Addition of Income from Sources Not Included in the “Official” U.S. Poverty Measure ................................................ 34

Effect of Earnings and Other Non-welfare Cash Income on Poverty ...................................... 34

Effect of Cash Welfare on Poverty .......................................................................................... 35

The Invisible Safety Net—Effect on Poverty of Counting Selected Income Sources Not Included in the “Official” Poverty Measure .................... 35

Effect of Food Stamp/SNAP Benefits on Poverty ............................................................. 35

Net Effect of the EITC on Poverty .................................................................................... 36

Effect of the ACTC on Poverty ......................................................................................... 37

Effect of Federal Economic Stimulus and Recovery Payments and Making Work

Pay Tax Credits on Poverty ............................................................................................ 37

Effect of Unrelated Household Members’ Income on Poverty ......................................... 37

Comparison of the Effects of Earnings, Transfers, and Taxes on Poverty, by Single Mothers’ Work Status ........................................... 37

Single Mothers Who Worked During the Year—Figure 14 .............................................. 38

Single Mothers Who Did Not Work During the Year—Figure 15 .................................... 42

Trend in Poverty among Children in Female-Headed Families under Selected Income Measures ......................................... 43

Discussion/Conclusion................................................................................................................... 44

The Invisible Safety-Net—Benefits not Officially Counted Toward Poverty Reduction ................................................ 45

Transformation of Income Safety-Net Programs Toward Work-Conditioned Support ........... 45

Cash Welfare’s Residual Safety-Net Role ............................................................................... 47

Living Arrangements as an Alternative to Welfare ........................................................... 47

Illness or Disability Among Nonworking Single Mothers ................................................ 49

The Work-Based Income Safety Net in Times of Recession and Recovery ............................ 53

Single Mothers’ Attachment to the Work-Based Safety Net ............................................. 53

The Work-Based “Safety Net” and the Role of Traditional Welfare ................................. 54

 

Figures

Figure 1. Children’s Poverty Status by Family Living Arrangement, 2013..................................... 4

Figure 2. Number of Recipients and Cases Receiving Cash Assistance Under ADC, AFDC, 1960 to 1994 ................................................................... 5

Figure 3. Number of Recipients and Cases Receiving Cash Assistance Under ADC, AFDC, and TANF, 1960 to 2013 ..................................................... 17

Figure 4. Poverty Rate of Children Under Age 18 in Female-Headed Households (No Spouse Present), 1960 to 2013........................................... 18

Figure 5. Number of Single-Mother Families, by Mothers’ Marital Status, 1987 to 2013 ............ 20

Figure 6. Poverty Rates by Mothers’ Marital Status, 1987 to 2013 ............................................... 21

Figure 7. Single Mothers: Poverty and Cash Welfare Receipt, 1987 to 2013................................ 22

Figure 8. Welfare, Work, and Poverty Status Among Single Mothers, 1987 to 2013 .................... 23

Figure 9. Employment Rates of Single and Married Mothers, by Age of Youngest Child, March 1988 to March 2014 ....................................... 24

Figure 10. Unemployment Rate of Women Maintaining Families, January 1987 through October 2014 ...................................................................... 25

Figure 11. Poor Single Mothers: Work and Welfare Status During the Year, 1987 to 2013 .......... 27

Figure 12. Receipt of Selected Benefits by “Earnings Poor” Female-Headed Families with Children, 1987 to 2013 ........................................................ 29

Figure 13. Effects of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status of Single Mothers, 1987 to 2013 ..................................... 33

Figure 14. Single Mothers Who Worked at Any Time During the Year: Effects of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status, 1987 to 2013 .......... 40

Figure 15. Single Mothers Who Did Not Work During the Year: Effects of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status, 1987 to 2013 ................... 41

Figure 16. Poverty Among Children in Female-Headed Families Under Alternative Measures, 1987 to 2013 ............................................................ 44

Figure 17. Single Mothers’ Living Arrangements, by Mothers’ Work and Welfare Status ............ 49

Figure 18. Single Mothers Who Did Not Work During the Year, by Self-Reported Reason for Not Working .................................................... 50

Figure 19. Nonworking Single Mothers with Self-Reported “Illness or Disability” as the Primary Reason for Not Working, by Cash Welfare Recipiency Status ..................................... 52

Figure 20. Single Mothers’ Job Attachment,1987 to 2013 ............................................................ 54

Figure B-1. AFDC/TANF Cases: CPS Estimates Versus Administrative Caseload Counts (Annual Monthly Average), 1987 to 2013 .................... 63

 

Tables

Table B-1. AFDC/TANF Cases: CPS Versus Administrative Caseload Counts, Annual Monthly Average, 1987 to 2013 ............................................ 64

Table C-1. Children’s Family Living Arrangements and Poverty Status, 1987 to 2013 ................ 66

Table C-2. Number of Recipients and Cases Receiving Cash Assistance Under ADC, AFDC, and TANF, 1960 to 2013 ........................................... 74

Table C-3. Poverty Among Related Children Under Age 18, All Children and Children in Female-Headed Households (No Spouse Present) 1960 to 2013 ............... 76

Table C-4. Mothers with Related Children Under Age 18, by Poverty and Marital Status, 1987 to 2013 .............................................................................. 78

Table C-5. Single Mothers: Poverty and Cash Welfare Receipt, 1987 to 2013 ............................. 80

Table C-6. Welfare, Work, and Poverty Status Among Single Mothers, 1987 to 2013 ................. 81

Table C-7. Employment Rates of Single and Married Mothers, by Age of Youngest Child, March 1988 to March 2014 .................................................. 82

Table C-8. Monthly Unemployment Rate of Women Who Maintain Families, January 1987 to October 2014 .............................................................................. 83

Table C-9. Poor Single Mothers: Work and Welfare Status During the Year, 1987 to 2013 .......... 84

Table C-10. Receipt of Selected Benefits by Female-Headed Families with Children, All Families and “Earnings Poor” Families, 1987 to 2013 ................................... 85

Table C-11. Effect of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status, All Single Mothers, 1987 to 2013................................. 88

Table C-12. Effect of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status, Single Mothers Who Worked at Any Time During the Year, 1987 to 2013 .................... 90

Table C-13. Effect of Earnings, Transfers, and Taxes on Family Poverty and Household Low-Income Status, Single Mothers Who Did Not Work at Any Time During the Year, 1987 to 2013 ............. 92

Table C-14. Single Mothers’ Living Arrangements, by Mothers’ Work and Welfare Status, 1987 to 2013 ....................................................................... 94

Table C-15. Single Mothers’ Work Status During the Year and Self-Reported Reason for Not Working, by Cash Welfare (AFDC/TANF/GA SSI) Receipt, 1987 to 2013 ....................... 99

Table C-16. Poverty Status of Children in Female-Headed Families Under Selected Income Measures, 1987 to 2013 ............................................................................................... 107

Table C-17. Single Mothers’ Job Attachment, 1987 to 2013 ....................................................... 109

 

Appendixes

Appendix A. From Mothers’ Pensions to TANF—A Brief History ............................................... 56

Appendix B. Cash Welfare Under-Reporting on the CPS ............................................................. 63

Appendix C. Support Tables .......................................................................................................... 66

 

Contacts

Author Contact Information......................................................................................................... 111

 

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This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.

 

 

 

 

 

 

 

 

 




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