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Aid Recipients Face Battle for Limited Jobs

WELFARE TO WORK: The Competition for California's Jobs * First in a two-part series

June 01, 1997|DOUG SMITH GREG JOHNSON and RICHARD O'REILLY | TIMES STAFF WRITERS

As California's historic welfare redesign races forward, reformers face daunting challenges to their announced goal of putting to work as many as 700,000 aid recipients, records and interviews show.

Despite a surge of economic growth that is creating about 350,000 jobs annually, competition will remain fierce in the next three years, according to state employment projections.

In the job market, welfare recipients will be pitted against more than 1 million unemployed people and many thousands of graduating students, immigrants and other newcomers to the work force.

And, in this climate of scarce jobs, today's aid recipients' are at a stunning disadvantage in education and work experience, a Times analysis of U.S. Census records found. The vast majority have no work experience and half have no high school diploma.

Such deficiencies, employers say, would make welfare recipients less attractive job candidates than unemployed people who have proven skills and track records.

To help level the playing field, the state Legislature is considering tax breaks and other incentives for employers--as well as job training, child care and other support that would enhance the chances of welfare recipients landing and keeping jobs.

Although high turnover in many entry-level jobs will make it easier to find work, economists say there still will not be enough positions for everyone. This has prompted Democrats to argue that government needs to subsidize employment for welfare recipients who cannot find work.

The Wilson administration rejects such job programs as ineffective, and insists that the state's economy can accommodate most of the welfare recipients and still generate enough jobs to lower unemployment to an ideal 5.5%, or about 800,000 people.

"Our goal would be to have all those people [on welfare] working," said H.D. Palmer, assistant director of the Finance Department.

California is being forced into these tough choices by the federal welfare reform bill signed into law by President Clinton last summer. The law sets annual deadlines for welfare recipients to be put to work and provides a lifetime limit of five years on public assistance.

A battle over California's welfare plan is expected to play out by the end of June in the Legislature.

Gov. Pete Wilson has proposed that new recipients can spend only 12 months on aid in a two-year period and that existing recipients can spend a maximum of two years in a three-year period--requirements that would push hundreds of thousands into the labor pool by the end of 1999.

Democratic leaders contend that Wilson's timetable is too harsh and that public jobs will be needed to pick up the slack when recipients lose their benefits.

Complicating the welfare-to-work effort, records show, is a mismatch: Many of the fastest-growing occupations are far from the centers of poverty or require more skill than most welfare recipients have.

Economists also warn that once recipients find jobs, they will need significant hand-holding to ensure they do not drift back to the ranks of the destitute.

According to census data, the majority of welfare workers will at best qualify for entry-level jobs that are low-paying and most often part time or temporary. Such jobs sometimes carry no fringe benefits, leaving employees vulnerable to illness and small crises such as car trouble. And if the state's economy should stall, they would probably be the first let go, social scientists said.

"Come the next recession--and it will probably come sooner than later--then the job availability problem becomes very acute," said Rebecca Blank, director of the Joint Center for Poverty Research of Northwestern University and the University of Chicago.

Economic Climate Is Right

Despite such doubts, most economists say conditions today are more conducive for welfare reform than at any time in the past 20 years.

"It's better to be done now, in this kind of economic climate where we're generating lots of new jobs than in the depths of our downturn," said Tom Lieser, associate director of the UCLA Business Forecast Project.

With the high annual rate of turnover in entry-level jobs--estimated to be 300% at some fast-food restaurants and hotels--most economists acknowledge that in theory there will be work opportunities for everyone on welfare, at least temporarily.

Bolstering the hopes of welfare reformers are the results of some experimental welfare-to-work programs around the country. Wisconsin has reported a 50% reduction in welfare rolls, driven largely by a more stringent timetable and work-training requirements. And Oregon has reduced its welfare caseload 37% with a program that turns over six months of assistance checks to employers who hire aid recipients.

California's Greater Avenues to Independence, or GAIN, program has put tens of thousands of welfare recipients to work showing that "the best welfare-to-work programs generate significant changes," according to a study by Manpower Demonstration Research Corp. of New York.

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