In 1988, the Family Support Act (FSA) sought to define a new social contract between government and welfare recipients. It decreed that parents both fathers and mothers should be the primary supporters of children; that welfare agencies should provide services and incentives to assist families in making the transition from welfare to self-support; and that welfare recipients who do not take steps toward independence from welfare should face meaningful consequences, such as a reduction in their welfare grants.

The primary vehicle for assisting welfare recipients to become self-sufficient under FSA is the Job Opportunities and Basic Skills Training (JOBS) Program. JOBS provides an array of job search, work experience, education, and training services to families who receive Aid to Families with Dependent Children (AFDC). Endorsing a view of welfare as involving an obligation on the part of its recipients, the legislation mandates (i.e., requires) participation in JOBS activities by all AFDC single-parent recipients with children age 3 and over (or, at state option, age 1 and over) to the extent that resources permit. Exemptions may be granted to recipients if they have a long-term illness or incapacitation, or are taking care of a household member who is ill or incapacitated; are of advanced age; are under age 16; are pregnant and past the first trimester; or are living in an area where the program services are unavailable. Welfare recipients for whom participation in JOBS is mandatory, but who fail to participate without "good cause" or who reject a bona fide offer of employment can be "sanctioned," that is, their portion of the welfare grant can be removed from their family's total grant.

Participation Standards and Why They Matter

The JOBS legislation broke new ground by setting forth explicit and gradually increasing participation standards that states must meet in order to receive the full federal match for any state JOBS funds.1 Welfare reform bills under debate when this report was written in July 1995 the Personal Responsibility Act of 1995, the Family Self-Sufficiency Act of 1995, the Family Support Act of 1995, and the proposed Work First Plan also included participation standards.

Advocates of federal participation standards see them as a vehicle for achieving several purposes designed to make the mandate real. First, standards provide a way for the federal government to motivate states to strive to achieve similar goals. Second, participation standards are a means of communicating to both welfare program administrators and recipients that welfare receipt represents a quid pro quo: that it is conditioned on recipients' involvement in employment-promoting activities, or in work itself. Third, such standards are seen as a way of fostering the movement of people off welfare.

The development of actual participation standards for welfare-to-work programs, however, often entails compromises among numerous interested parties, and agreed-upon standards may be complex. There are several reasons for this. First, the higher the participation standard, the more money is generally needed to pay for program activities, child care, and program staff so that they can quickly assign individuals to work-promoting activities, closely monitor their participation and progress, and enforce penalties for non-compliance with program requirements in a timely manner. Second, it is difficult to develop standards when, as is the case with welfare-to-work programs, there is not widespread agreement on the goals of the programs or on the program practices most likely to achieve those goals. Third, standards "drive" the performance of a system. How one defines participation, the group of individuals to whom the participation standards apply, and the penalties for not meeting the standard will all result in welfare department staff behaving in different ways and emphasizing different procedures or outcomes. As a result, policymakers often include numerous complicated safeguards in the standards, seeking to avoid unintended consequences or program practices that are at cross purposes with one another. Finally, the development of welfare-to-work program participation standards is difficult because of the push for demanding standards against the pull of what is affordable and attainable. It is challenging to create standards that are viewed as both tough enough but not so tough that states cannot meet them and the standards come to be seen as only a pro forma requirement. Such unmet expectations carry with them the risk that the public will become even more disenchanted with government's ability to change the character or conditions of welfare.

The Nature of This Report

This report is one in a series produced as part of a seven-site, national JOBS Evaluation sponsored by the U.S. Department of Health and Human Services (HHS) and the U.S. Department of Education (ED), and conducted by the Manpower Demonstration Research Corporation (MDRC). The report analyzes data from three of the evaluation sites and addresses several issues related to participation standards.

• How do participation rates for these three sites, which operated well-managed, mandatory, and relatively "tough" JOBS programs, compare to those measured in past studies of welfare-to-work programs?

• What proportion of the AFDC recipients currently required to participate in JOBS are actually involved in a JOBS activity during a typical month? What proportion of all AFDC single-parent cases do these participants represent?

• Why are participation rates not higher?

• What changes would be needed in order to raise participation rates?

• Finally, since participation standards are again a topic of public debate, what do the report's findings suggest for the participation standards being developed in the current welfare reform bills?

Using data collected from the case files of 1,113 AFDC recipients in three of the JOBS Evaluation sites, the report presents various monthly participation measures, documents reasons for non-participation among those who were not in JOBS activities in typical months, and discusses the challenges of setting welfare-to-work program participation standards that reflect various desired outcomes, are achievable, and are equally challenging in different states. The report focuses on participation in two "typical" months during the evaluation: October and November 1992.

The three sites examined in the report Atlanta, Georgia (Fulton County), Grand Rapids, Michigan (Kent County), and Riverside, California (Riverside County) are particularly useful localities in which to examine what may well be the upper limits of JOBS participation under current funding. These sites all had substantial experience operating welfare-to-work programs prior to JOBS, and have sought to run JOBS programs serving all AFDC recipients required to participate under current law. In addition, unlike many localities, these sites run mandatory programs, meaning that they require participation by all JOBS-mandatory individuals, demand participation in work-promoting activities for as long as individuals are receiving AFDC, and do not hesitate to use formal mechanisms, i.e., AFDC grant sanctions, to enforce the continuous participation requirement. (During the period under study, two of the three sites were known as running JOBS programs that were among the toughest in their respective states.)

Furthermore, early random assignment-based findings show that the three sites appear to have produced large reductions in the numbers of individuals receiving AFDC and to have resulted in more people becoming employed during a two-year follow-up period. Finally, the sites represent a range of conditions in terms of caseload size and demographics as well as AFDC grant levels, local labor markets, staff/recipient ratios, recipient enrollment practices, JOBS program philosophies, and costs under which to study how and why participation rates vary.

Highlights of the Findings

This report points to eight major findings.

1. A participation rate is a ratio and, as such, is highly sensitive to who is counted in the numerator and who is included in the denominator. Decisions on both will affect the feasibility and cost of achieving a particular participation rate.

2. The participation rates for the three sites are at the high end of and, for two of the sites, higher than those found in past welfare-to-work programs. In two of the sites studied, monthly participation rates exceed those achieved in the San Diego Saturation Work Initiative Model (SWIM) study, a demonstration specially funded to determine the maximum level of monthly participation feasible in welfare-to-work programs of the 1980s. Measured over two years, participation rates in the three sites are at the high end of the range reported in MDRC's studies of other mandatory welfare-to-work initiatives in the 1980s and early 1990s.

3. In each week in a typical month (in 1992), up to 14 percent (depending on the site) of those mandated to participate in JOBS were either active in JOBS for at least 20 hours or working at least 15 hours. This monthly participation level based on a measure that shares some (but not all) of the features of the JOBS measure is roughly comparable to the goal specified in the JOBS regulations for 1992. (These required that, on average, 11 percent of the JOBS-mandatory AFDC recipients who did not have good cause reasons for not participating were supposed to be JOBS participants in each month in that year.)

Even though they are not all currently required to participate (and are thus not all in the JOBS program), it is informative to ascertain what percentage of all single-parent AFDC case heads in each week in a typical month participated in a JOBS activity for at least 20 hours or were employed for at least 15 hours. That proportion is 5 to 10 percent, depending on the site.

4. Using another, more inclusive measure, up to 44 percent of JOBS-mandatory individuals participated in a typical month. Many JOBS-mandatory individuals did not meet the above standard, but were being sanctioned for non-participation or were participating for less than 20 hours in at least one week of the month. Expanding the numerator of the rate to include people who were being sanctioned or who participated or were employed (for any number of hours) in every week raises the monthly participation rate to between 20 and 26 percent of the JOBS-mandatory individuals in any site (which translates to between 9 and 21 percent of all AFDC cases). Expanding the numerator even further, to include those who participated, were employed, or were sanctioned at any point in the month (not in every week in the month), monthly participation rates reach as high as 44 percent.

5. Increasing participation rates substantially will require more money, but some reasons for non-participation are not funding-related. Increasing participation requires sufficient staff (i.e., funding) to quickly provide JOBS orientations to all JOBS-mandatory AFDC recipients and assign them to JOBS activities, to closely monitor every individual's participation and progress, and to react to individuals' non-compliance with program requirements in a timely manner; ample resources to operate or fund job clubs and other activities; and funding for support services such as child care. In addition, some non-participation could be alleviated through the use of more efficient automated tracking systems or case management procedures. Some reasons for non-participation, however, are unlikely to be alleviated with more funding: In any given month, many AFDC recipients are not active in JOBS because they or family members are ill, or they are in a brief waiting period before scheduled activities outside the welfare department (and not funded by JOBS) begin.

6. Monthly rates underestimate participation and employment because these statuses, as well as spells on welfare, are dynamic processes. Every month, people start and end job search, work experience, education, and training activities, as well as employment. In addition, people join and leave the AFDC rolls every month. As a result, many individuals participate in JOBS activities at some point, even if they are not participating in a given month.

7. A uniform national participation standard can impose a very varied burden on different states. The difficulty of establishing a "level playing field" derives from differences in many conditions across states, including state AFDC grant levels, caseload demographics, and economic conditions. For example, if employment while receiving AFDC is not counted as "participation," high-grant states, or states with generous income "disregards," will (other things being equal) have lower participation rates. This is because many AFDC recipients in these states will still qualify for AFDC while simultaneously working and receiving welfare, and will have more of an economic incentive to work. If employment is not counted in the standard, these states will be at a disadvantage.

8. If activity in the three sites stayed at the levels measured for 1992, these sites would fall far short of the ultimate participation standards contained in current welfare reform bills. The report roughly assesses how well, in terms of participation rates, these three sites would fare under the welfare reform bills mentioned earlier. If exemption criteria under some of the current bills are applied to the AFDC caseloads of the three sites in this report, and it is assumed that participation levels remain the same, approximately 16 percent of the newly defined mandatory AFDC case heads in these three sites could be expected to be "covered" by participation in program activities, employment, or sanctioning in a typical month. (This calculation assumes that funding levels, welfare regulations, and the behavior of welfare recipients in the future will result in the same numbers of individuals participating at least 20 hours per week, being employed, or being sanctioned in each week in a month as was found during the months studied for this report.)

Since the current welfare reform bills all specify monthly participation rates that start lower but steadily increase to 50 percent by the year 2003, this estimate suggests that the sites examined for this report all of which had substantial experience and ran strict, mandatory, and successful JOBS programs would need to experience dramatic changes in program rules and practices, welfare recipients' behavior, or funding in order to reach the ultimate standards contained in those bills.