This summer the clock begins ticking for the new time limits for finding work and cutting off benefits that are the centerpiece of the 1996 welfare reform legislation.
Within eight years, 41% of the current caseload of AFDC recipients will reach the 60-month cutoff for lifetime receipt of welfare, according to a new study by Greg Duncan (IPR-Education), Kathleen Mullan Harris, and Johanne Boisjoly that examined monthly patterns of AFDC receipt during the 1980s and early 1990s. And within two years, the 24-month work requirements will force states to seek employment or some form of allowable work activity for 52% of their current caseloads.
"The percentage of recipients that is likely to be affected by the 60-month limit on welfare receipt is twice as high as the percentage of exemptions allowed in the new legislation," said Duncan, who is also an affiliate at the Northwestern University/University of Chicago Joint Center for Poverty Research. Given block grants to offer time-limited assistance under the new welfare block grant program, states are permitted to exempt up to 20% of their caseloads from the 60-month lifetime limit for reasons of hardship.
"Unless behavior changes dramatically in response to the 1966 provisions, our estimates suggest that even when applying the most optimistic assumptions, an alarming number of low-income families will be affected by the new time limits," said Duncan. "The number of children ultimately affected will run into the millions."
The researchers used Panel Study of Income Dynamics (PSID) data on monthly patterns of AFDC receipt and employment between 1983 and 1995 to estimate how many families will be affected by the new welfare legislation and the length of time it will take for recipients to reach work and benefit cutoff deadlines.
Those most at risk are recipients who have never been married; who got on welfare when they were young; who lack a high school diploma; and who had preschool children when they first received welfare.
The distinction between current caseload recipients and first-time recipients is crucial in estimating how many families are likely to be affected by time limits, said Duncan. A 60- month limit applied to families first starting to receive benefits will affect only a minority of them, since most will never reach the limit. That is not the case, however, for the current caseload, which is overrepresented by long-term recipients.
The researchers caution that estimates may overstate the percentage of recipients affected by the new time limits, because some families may change behavior in anticipation of the time limits. "Still, even very optimistic assumptions about behavior leave more than one-third of recipients facing benefit cutoff," Duncan said.
The study, entitled "Time Limits and Welfare Reform: New Estimates of the Number and Characteristics of Affected Families," is available on the Web at http://www.spc.uchicago.edu/PovertyCenter, or may be ordered for $5.00 from the Poverty Center.
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