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New Welfare System Seen as 'Recession-Proof'

Most ex-recipients have held on to their jobs even as unemployment rises in general. But some say stability in the rolls signals trouble.

March 24, 2003|Elizabeth Shogren | Times Staff Writer

CHICAGO — Eleven months ago, when the local unemployment rate was steadily rising, Shantrese Burkes was defying the trend. A welfare mom with three kids, she landed a $9-an-hour job as a cashier at a cafe attached to a gas station.

She didn't stop there. Two promotions later, Burkes, 28, is earning $27,000 a year as the cafe's manager and is eyeing her next step up the ladder.

Burkes could be a poster child for the welfare overhaul of 1996, when Congress limited lifetime benefits to five years and encouraged states to require recipients to go to work.

At that time, advocates for the poor predicted that the program would end in disaster for those who lost their safety net. When, instead, welfare recipients flocked to jobs during the booming second half of the 1990s, advocates warned of an unraveling when the economy finally turned sour.

The economy is now in its third sour year. But to the surprise of many of reform's loudest boosters, onetime welfare recipients have held on to most of their gains in the job market -- even as jobless rates among the general population are rising. Welfare rolls have remained level nationwide, and continued to decline in Chicago and other big cities.

"The forecast that somehow a recession was going to dramatically undermine the gains we have seen in five years simply did not happen," said Wade F. Horn, assistant secretary for children and families at the Department of Health and Human Services. "The new welfare program is relatively recession-proof."

Burkes' success story has been duplicated hundreds of thousands of times around the country. Job placement professionals say they can still find work for most of their welfare clients -- and that when they do, the clients are invariably better off than they were on the dole.

The '96 law, they say, has brought about a significant cultural shift among poor, single mothers. Work has taken the place of welfare checks for millions of them as the primary way that they expect to support their families -- exactly what reform sponsors had hoped.

Some poverty experts, however, find the failure of the welfare rolls to rise in tandem with unemployment to be an ominous trend. To them, it suggests that more and more people are slipping through the cracks between welfare and work.

In Chicago, former welfare recipients tell of friends who resorted to hustling drugs and sex to support families after their jobs withered. They tell of others who moved in with a succession of relatives before taking their chances at a homeless shelter.

"But whatever has happened hasn't happened in massive numbers," said Harry Holzer, a professor of public policy at Georgetown University. "Part of that may be due to the fact that so far, the recession has been relatively mild."

Even the bleak job market has been easy on welfare reform. Low-paying jobs have weathered the downturn better than others.

In Chicago, with an unemployment rate of 8.1% in January compared with the national level of 5.8%, many welfare recipients are still moving into low-rung jobs as home health-care workers, day-care providers and janitors. At the bottom of the ladder there is opportunity to climb.

"I came in as a cashier in April," Burkes said. "In three months I became an assistant manager, and in three more months I became the manager."

Ten people report to her, and she has hired other former welfare recipients. "I snatched my sister off welfare and gave her a job," Burkes said with a smile. "My sister-in-law too."

Burkes' children, ages 7 to 11, also enjoy their mother's success. "They can't wait until payday; that's when they get their allowance," Burkes said.

Nationwide, never-married mothers such as Burkes -- the group that had most commonly relied on welfare -- have flocked into the workplace. Only 47% of such women were employed in 1994, according an analysis of census data by the nonpartisan Urban Institute. By 2000, 69% had jobs, a figure that dropped slightly, to 68%, in 2002.

"We haven't seen the kind of drop-off [in employment] that people were most worried about, and that seems to be reflected in the welfare rolls themselves not jumping up dramatically," said Robert Lerman, an economist at the Urban Institute and American University in Washington.

One reason: People who were long-term welfare recipients in 1996 have become connected to the workforce. Some remain with their original employers and are promoted; some lose their first jobs but find others.

Rita Flowers, who like Burkes lives on Chicago's impoverished west side, used to personify the dependency Congress sought to break when it overhauled benefits. She had received welfare for 16 years, had six children, and couldn't imagine life without public aid.

But four years ago, she started working as a child-care provider for $5.20 an hour. Now she's a head teacher at her day-care center, earning $1,054 every two weeks, about $13.20 an hour.

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