Welfare Reform

Updated July 10, 2020 | Infoplease Staff

1997 News of the Nation

A year after the historic legislation was signed into law, the national welfare rolls have dropped by 1.5 million people to the lowest numbers in 27 years. Most of those who have left have been able to find jobs in the expanding economy, but experts warn that further reductions won't come so easily. Those who have already left the rolls were the most “employable” recipients; those who remain are more likely to be “unemployable” due to drug addiction, or physical or mental handicaps. Furthermore, although the economy is providing new jobs, there are fewer middle-income jobs available so “workfare” recipients are most likely to find lower-paying jobs.

It is therefore not surprising that half the states failed to meet the target of having 75% of married welfare families either in job training or in jobs by October 1, 1997. States failing to attain the goals set forth in the bill passed in August 1996 may face penalties of as much as 5% of the funds granted to the state, though the Dept. of Health and Human Services has the option to waive these penalties on a case-by-case basis.

The news for these new additions to the labor pool gets worse. Republican efforts to exempt welfare-to-work employees from the $5.15 minimum wage further exacerbates the wage problem and inflames the debate over whether welfare reform is actually helping anyone. While Republicans claim a reduced wage for welfare recipients will make them more attractive to potential employers, Democrats claim that welfare recipients are entitled to the same “living wage” as other Americans. The “working poor” are becoming ever-more apparent in the increased demands on food banks. Second Harvest, the nation's second-largest food bank, reports increased demands for food at half of its 183 centers. The government accounted for 13.5% of publicly distributed food in 1997, down from 22.2% in 1991. Private sources say the additional strain on their reserves cannot sustain the growing need as welfare reform requires people to take work—any work—even if it doesn't pay enough to put food on the table. —TMV