Welfare Rolls for State, L.A. County Begin to Plummet

After lagging behind other states, California’s welfare rolls have suddenly begun to plummet, declining by nearly 140,000 in a three-month period.

State officials said Wednesday that a booming economy and the prospect of stiff new time limits under welfare reforms have encouraged recipients to leave public assistance in record numbers.

Even in Los Angeles, where job losses were especially severe during the recession, welfare caseloads have plunged to the lowest level in five years as 36,000 recipients left the rolls.

California’s welfare rolls had been showing a modest decrease for months but the rate of decline rapidly accelerated in May, June and July to nearly 2% a month--more than double what it had been previously. In the last year, the rolls declined more than 11%.

“This is huge,” said Ted Gibson, chief economist for the state Department of Finance. “For California to see monthly declines of over 1% is just amazing. And for Los Angeles, the only metropolitan county that hasn’t regained its pre-recession peak in employment, to see the welfare rolls decline is pretty remarkable.”

Officials believe that former welfare recipients have moved into jobs. Although the question has not yet been researched, they cite indications that many onetime recipients have entered the workplace.

National figures show a rise in the number of jobs going to single mothers, many of whom are believed to be former welfare recipients.

In California, officials have noted that an increasing number of welfare recipients also have jobs, causing their aid payments to go down.

Spending on welfare grants has dropped nearly 23% in the last year, according to Eloise Anderson, the state’s Social Services Department director.

“What that says to me is that I’ve got two things going on here,” Anderson said. “I’ve got a whole group of people who are working and getting off welfare, and I’ve got a whole group of people who are working but they haven’t made enough money yet to get off welfare.”

The sudden decline in recipients, Gibson said, is particularly significant because California rolls have remained high during the last year when other states were experiencing sharp drops.

The president announced in July that 1.2 million recipients nationwide had moved off public assistance since he signed a massive federal welfare reform law in August 1996. In the last year, welfare rolls dropped 19% in Florida, 16% in Pennsylvania, 26% in Wisconsin and 23% in Oregon.

Gibson attributes California’s decline to what he calls the “announcement effect.” As the Legislature debated and passed a welfare reform plan in May, June and July, the attendant publicity forced a realization by recipients, he said, that welfare reform with its strict time limits and stiff work requirements was finally coming to California.

“People are beginning to realize that the program is changing and that the kind of behavior that perhaps had been going on for decades literally may not be acceptable anymore,” he said.

Although other states had already implemented their reform plans, California’s was delayed by partisan wrangling in the Legislature. It still will not go into effect until Jan. 1, allowing recipients to remain on the rolls more than year longer than in some states.

Anderson said she expects the rolls to continue to shrink as county welfare agencies increasingly shift their emphasis to moving recipients into jobs, rather than maintaining them on welfare.

Although counties have not completed reports on their August figures, officials said a preliminary examination shows the decline is continuing although at a somewhat slower rate.

With its revamped welfare-to-work programs, Los Angeles County has played a key role in reducing the state’s welfare rolls, Anderson said.

“You can’t move the number of people that Los Angeles is moving into the work force and not affect what we’re doing statewide,” she said. “Los Angeles is like an elephant; when it moves, we all move.”

Ann Jankowski, chief of the budget and management services division of the county’s Department of Public Social Services, said officials have no conclusive explanation but believe the improving economy and the specter of welfare reform have driven down the rolls.

“We’re getting more people into jobs,” she said. “They might not all be able to leave welfare completely but certainly they are getting less welfare.”

Mary Daly, a researcher for the Federal Reserve Bank in San Francisco, said national statistics show the number of women entering the job market who head families is skyrocketing. She said that factor coupled with the falling unemployment rate would indicate that many welfare recipients are entering the work force.

Gibson said that although the improving economy has helped provide jobs for welfare recipients, he believes the motivation for them to leave the rolls was probably created by welfare reform.

What is happening now to the welfare rolls, he said, is new for California, because in the past an improving economy has not always caused the number of recipients to decline.

Until 1995, when the rolls began a modest decline, he said the last time California’s welfare caseload had dropped was in 1972.

“Our history, our experience tells us that the effect the economy has had on welfare caseload is to slow its growth down but not to make it decline,” he said. “I think what has happened is that we have taken some measures to make welfare perhaps a little bit less attractive.”

Anderson said the huge government investment in child care has made it easier to leave welfare for those who are the most employable.

“I think you have some parents out there who are pretty sophisticated,” she said. “I think they looked up and said, ‘Five year time limits, I’m out of here.’ ”

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

‘97 Welfare Numbers

Through July, the number of people on welfare declined each month this year in Los Angeles County and statewide.

*--*

Month L.A. County % change Statewide % change January 837,106 -0.5% 2,472,872 -0.6% February 831,976 -0.6% 2,464,251 -0.3% March 827,414 -0.5% 2,444,275 -0.8% April 822,043 -0.6% 2,424,344 -0.8% May 809,107 -1.6% 2,380,478 -1.8% June 791,775 -2.1% 2,329,877 -2.1% July 785,641 -0.8% 2,284,541 -1.9%

*--*

Sources: California Department of Social Services, Los Angeles Department of Public Social Services

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Welfare Decline

In recent years, the number of welfare recipients in California has been rising steadily. Since federal reforms were adopted a year ago, the rest of the country has seen a downturn in the number of recipients. California’s decline has been modest until recent months, when it began to accelerate.

1980: 1.36

1995: 2.68

1997: 2.48

Source: California Department of Social Services