You can't get something for nothing, welfare study shows. Defunct Chicago program tried to make do with just $130 a person
One of the most important welfare questions, one with enormous ramifications in this cost-conscious era, has been answered. It is: If you require people on welfare to get jobs but have little money for training them or helping them find jobs, will the program work? The answer is no, based on a study to be released today by the foremost research organization on welfare programs, the Manpower Demonstration Research Corporation .
Based on research into a now-defunct Chicago program, social scientists and politicians seeking to reform America's welfare system now have, for the first time, a parameter: a level of spending that is so low as to produce ineffective results. This is an important finding at a time when budget pressures are prodding states to try to reduce their welfare rolls without spending much if any additional funds.
The finding comes, too, at a time when broad national welfare reform appears once again stalled in a divided Congress that is preoccupied with other priorities.
But in Congress, as in the states, the pressure is strong for change that will reduce both the welfare rolls and the amount of money spent on welfare recipients.
The new study appears to say that in the short run, at least, you cannot have it both ways.
The Chicago program had sought to spread a small amount of money among all the city's welfare recipients, spending approximately $130 on each. But the study concluded that the program did not get more people into jobs than would have occurred if nothing had been done. Neither did it lead to higher earnings for those who found work.
Although there were monetary savings for the welfare program, these were minimal: 1 to 3 percent of the total cost.
``These numbers,'' says Judith Gueron, ``remind us that you have to spend at least a certain amount of money if you're interested in increasing employment earnings.''
The Chicago program spent the lowest amount per participant of any of the six major programs that were studied by the of which Dr. Gueron is president.
One of the most important remaining questions about workfare is the opposite one: Does spending more money to help recipients escape welfare give them a bigger boost?
And there is a corrolary question: At what point is the amount of money a program spends the optimum? This issue would be measured two ways: the number of people who leave welfare and, ultimately, the hoped-for cost saving for the welfare system itself.
Dr. Gueron's organization is in the early stages of a study of at least five years that may yield answers. It is examining California's fledgling, statewide program that is gaining interest nationwide. The program provides more intensive services than most states, and more educational assistance.
Similarly intensive programs in Illinois and New Jersey may help provide answers, too.
In five previous studies Gueron's organization found that, in general, modest benefits flowed from requiring welfare recipients to work and providing modest assistance to them in their training and job search.
These modest benefits usually occurred in two areas: savings in welfare costs and increases in the number of people who found jobs in the marketplace.
From a study in West Virginia, however, another parameter to workfare was established: that if no jobs exist for welfare recipients to fill, providing them training will not lead to jobs.
Despite these answers, other important questions remain. One is finding a way to get young mothers with young children off the welfare rolls. ``We know very little about what is going to work with that part of the caseload,'' Gueron notes.
Another question: to what extend does extending transitional benefits, such as day care and medicaid, for people trying to work their way off welfare actually result in their leaving the rolls?
Several states are experimenting with such efforts, but the results are not yet in.