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Article Excerpt
The Self-Sufficiency Project (SSP) offered a generous but time-limited earnings supplement to a randomly assigned group of lone parents--who were also long-term social assistance recipients--if they round full-time work and left social assistance. Employment data was collected for this group over a three-year period following the offer, and for a randomly-assigned control group. This article analyzes the characteristics of the first job that SSP participants round after they left social assistance. The occupations and industries of the first job held are analyzed as is SSP's impact on hourly wages, weekly hours and job stability. The article finds that SSP increased employment in jobs that were no worse (and no better) than the jobs that participants might have taken in the absence of the program.
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When welfare-to-work programs encourage participants to find work, these programs can also bring about dramatic changes in participants' lives. It is possible that these changes may not improve welfare recipients' well-being. For example, social assistance recipients who leave welfare for work could lose income and experience increased stress, while their children may receive less care and supervision. Alternatively, such programs might set in motion a series of events leading participants to positive outcomes such as economic self-sufficiency. This article considers one such welfare-to-work program, the Self-Sufficiency Project (SSP), a random assignment demonstration of an earnings supplement implemented from 1992 to 2001 in British Columbia and New Brunswick. (1)
During the period that SSP was being developed and implemented, social assistance programs across Canada were undergoing extensive reform. Major reforms implemented in some provinces emphasized the reduction of welfare caseloads by restricting eligibility and by moving social assistance recipients into employment. Since 1995 every province and territory has introduced some welfare-to-work element into its social assistance system (Gorlick and Brethour 1998). While many reform efforts were motivated, to some extent, by fiscal prudence, a philosophy of work as socially preferable to welfare has also influenced the tenor of reform strategies.
One of the concerns most frequently voiced about the contemporary emphasis on encouraging lone-parent welfare recipients, most of whom are women, to move from welfare to work is that such women might simply be trading poverty-and-welfare for poverty-and-work. If a welfare recipient wishes to be a full-time mother, carefully supervising the many aspects of her children's development, no amount of money, prestige or job satisfaction will substitute for being home. (2)
Others argue that there are no "bad" jobs, that any job--no matter how poorly paid, no matter how difficult--is preferable to long-term welfare dependence. And even if the first post-welfare job is a "bad" job, in terms of earnings or working conditions or both, some former welfare recipients might eventually be able to move into a "good" job.
Within the context of the Self-Sufficiency Project, there is a concern that even though SSP was successful in achieving significant increases in employment over the first 36 months, the project could conceivably have led participants to take "bad" jobs in order to qualify for the supplement. That is, encouraging self-sufficiency with an earnings supplement could reduce the chances of finding a "good" job.
The SSP earnings supplement encouraged many participants to leave social assistance and take up paid employment. This article uses administrative data as well as data from follow-up surveys to examine the first job that participants held after they left Income Assistance (IA). First, the occupations and industries in which participants worked are described. The impact that SSP had on employment in different occupations and industries is then estimated.
This article also analyzes whether SSP had an impact on characteristics of the first job held after leaving welfare including the following: wages, hours, job duration, the receipt of employer-sponsored benefits and union membership. Finally, the article identifies four job characteristics that may be considered positive indicators of job quality, and estimates the impact SSP had on employment in jobs with these characteristics.
RECENT RESEARCH ON THE JOB QUALITY OF FORMER WELFARE RECIPIENTS
Defining Job Quality
One aim of an analysis of jobs held by former welfare recipients might be to determine if those jobs enable the workers to be self-sufficient. One important factor contributing to self-sufficiency is an income greater than that available through welfare. Such an analysis would focus on earnings (including tax benefits like the National Child Tax Benefit) and benefits. Job duration is also important here since it may indicate that the ability or willingness of the worker to hold a job might be linked to wage progression or other types of advancement.
A different, and perhaps complementary, aim of such an analysis might be normative. Are these the kinds of jobs that the analyst believes will eventually lead to a more satisfying life than that available on welfare? Here, the type of job matters because some jobs may lead to higher paying, more rewarding jobs as the worker gains experience. The type of job also determines the type of activities in which a worker spends a substantial proportion of their time. Those activities determine, in part, whether or not workers find their lives satisfying.
Assessing the quality of a job might seem straightforward: some jobs are seen as being better than others are. Everyone recognizes this fact, both when they discuss jobs in daily conversation and when they must actually choose among jobs. Yet social scientists have no comprehensive measures of a job's desirability. Sociologists have devised many schemes for ranking occupations, but none for ranking the diverse jobs that fall into the same occupational category. Economists rank jobs according to their pay but have no global measure of jobs' non-monetary benefits (or costs). Psychologists measure workers' subjective satisfaction with their jobs but have not, for the most part, tried to rank jobs on the basis of objective characteristics (Jencks, Perman and Rainwater 1998: 1323).
There are no widely accepted job quality scales that translate various job characteristics such as wages, benefits, autonomy, or social setting into a single numerical measure of the quality of the job. (3) One reason is that the quality of a job is largely subjective--the same job might be considered to be "ideal" by one individual, and a "nightmare" for a second individual.
Studies of welfare "leavers" in the U.S. suggest that those who leave welfare for work move into jobs similar to those held by other low-income workers. These jobs pay low wages and offer few benefits. For example, Loprest (1999) studied a group of "leavers" in the period immediately after the passage of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), the landmark U.S. welfare reform of 1996. Using the National Study of America's Families (NSAF), Loprest was able to analyze, for each job, variables such as hourly wage, hours of work, occupation and industry, the provision of health benefits, and whether another job was held simultaneously. Over all Loprest (1999: 9) found that "the types and quality of jobs held by former welfare recipients are similar to those held by other low-income mothers."
The U.S. government commissioned several state-specific studies of welfare "leavers" in the wake of PRWORA. Most of these studies used state-level administrative data to characterize the employment and earnings of the "leavers." Several studies involved surveys of "leavers" that provided somewhat more extensive information than could be obtained from the administrative data alone. According to a synthesis by Acs and Loprest (2001), these studies found, in general, that "leavers" had relatively low earnings and few benefits. The studies did hOt provide much further detail on the jobs held by "leavers."
Bartik (1997) analyzed a large sample of women who had both been on welfare and worked in the calendar year prior to being interviewed as part of the March Current Population Survey (CPS). The focus of the analysis was on estimating the effects of job characteristics on the probability that the women were employed at the time of Match interview. The job studied was the one held in the year prior to the March interview.
Bartik's major finding was that, holding wages constant, the occupation and industry of the job were important determinants of the probability of working at the time of the Match survey. For example, those who worked in hospitals or educational institutions were more likely to be employed at the time of the March survey than others, and cashiers and labourers were less likely to be employed.
A "good" job was one that increased the probability of being employed at the time of the March CPS interview. For example, working as a cook in an eating or drinking establishment lowered the probability of working, whereas working as a waitress in an eating or drinking establishment did not. Wages and hours were also quite important but the magnitude of the occupation and industry "effects" was often larger than the effects of wages or hours.
The implication was "... that the characteristics of jobs matter. Policymakers should consider efforts to target higher-wage jobs, jobs in the hospitals or educational services industry, and jobs with less customer contact and less intense supervisory pressure" Bartik (1997: 41).
In summary, the literature suggests that job quality has at least three important dimensions. First, job quality might be assessed by the nature of the work and the work environment. Work that is interesting, physically comfortable, or which provides access to a social network, for example, might be considered of high quality. Second, job quality can also be related to future job prospects. High quality jobs might be described as jobs that either provide wage growth or lead to other higher paying jobs. Third and finally, job quality can arise from the compensation, whether cash or in-kind, that workers receive for their labour.
For this article, the limitations of the available quantitative data prevent the estimation of the effect of SSP on any measures of the first, and most subjective, source of job quality. Based on lessons from the literature, this article does, however, attempt to identify measures of the second and third dimensions of job quality.
THE SELF-SUFFICIENCY PROJECT
The Self-Sufficiency Project (SSP) was a random assignment demonstration that tested the effect of a generous financial incentive on the behaviour of long-term social assistance recipients in New Brunswick and British Columbia. (4) SSP was a voluntary program that offered lone parents, who had received Income Assistance (IA) for at least twelve months, an earnings supplement if they round full-time work within one year and left IA. If SSP participants had taken up the supplement within the one-year window, they were then eligible to receive it for the next three years. SSP was designed to "make work pay" more than social assistance. To this end, the SSP supplements could potentially double earnings from minimum wage...
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