The Labor Market Effects of Welfare Reform

Bibliographic Data

ID3536334
AuthorsDarren Lubotsky (0000-0003-2602-7220, University of California, Berkeley, corresponding author)
Year2004
Volume57
Issue2
Pages249-266
Publication date2004-01-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueIndustrial and Labor Relations Review (JOURNAL)
Journal identifiersISSN: 0019-7939 • E-ISSN: 2162-271X
PublisherSAGE Publications Inc (PUBLISHER)
DOI10.1177/001979390405700205
OpenAlexW3125120176
LanguageEN
Citations received5
References cited17

A major goal of the 1996 federal welfare reform was to increase the labor market participation of welfare recipients. Some analysts have speculated that if the reform is successful, this increase in labor supply may exert downward pressure on wages and reduce the employment rate of other low-skilled workers in the labor market. The magnitude of these hypothetical labor market effects is uncertain because there have not been large changes in eligibility for federal welfare programs from which to draw inferences. This study treats the 1991 elimination of the General Assistance program in Michigan as a rough analog to the 1996 federal reform. In all, about 82,000 able-bodied adults lost benefits. Comparisons with other states indicate that employment in Michigan increased by two to four percentage points among high school dropouts, which corresponds to 25-50% of the original GA caseload. There is little evidence of wage or employment declines among other low-skilled workers

Demographic economics · Earnings · Economic growth · Economics · Fell · Labor relations · Labour economics · Market economy · Political science · Poverty · Secondary labor market · Split labor market theory · Wage · Welfare · Welfare reform · Welfare state · Workforce · Fiscal Policy and Economic Growth · Gender, Labor, and Family Dynamics · Labor market dynamics and wage inequality · Urban, Neighborhood, and Segregation Studies

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