Number Applying for Welfare Plunges

The number of first-time applicants for welfare benefits in California has fallen by one third over the last three years, according to the most recent state records, underscoring a significant overall decline in applications that officials say has saved taxpayers millions of dollars.

According to state Department of Social Services records, there were 26,405 welfare applicants in November 1997, the latest month for which figures are available. That was a drop of more than 12,000 applicants from the November 1994 total of 38,958.

Other months showed similar declines. There were, for instance, 5,000 fewer applicants in July 1997 than in July 1994. Welfare reforms that took effect in January are expected to push the numbers down even further.

Experts cite three reasons for the decrease. First, a roaring economy has made jobs plentiful. Second, welfare reform puts a lifetime limit on welfare benefits, so potential applicants may be trying to “husband that resource until they really need it,” according to Ted Gibson, chief economist for the state Department of Finance.

Finally, the new welfare rules may be weeding out people who had been holding jobs while receiving benefits. For such people, the new documentation required every week to prove that they are training for jobs or looking for work doesn’t leave much time for under-the-table jobs.

“If you have to do job training and interviews for us 32 hours a week, it makes it hard to keep a job and hide it,” said Eileen Lafferty, an eligibility technician who works with clients at the Anaheim Regional Center, one of four welfare offices in Orange County.

“The economy is healthy, yes. But there’s two other things going on,” she said. “When they hear what we want them to do--go to motivational training, apply for 15 jobs, document the applications, etcetera--they say, ‘It’s easier to just go get a job.’ And the other thing is, I have to say it, some people have been working all along.”

Crowds in the massive waiting room at the Anaheim welfare center have been shrinking steadily for years, workers say, but have declined even more sharply in recent months.

Some people, when they learn of the stiff new requirements under Cal-Works, the state’s new welfare-to-work program, are “walking out when they hear everything we want them to do,” supervisor Pat Stuteville said.

The number of new Orange County applicants in July 1997 was 1,100, less than half the all-time high of 3,300 in the same month three years before, said Angelo Doti, deputy director of the county’s Social Services Agency and architect of its welfare reform program.

Doti said a “fear factor” about welfare reform in recent years prompted many people to look for jobs instead of applying for assistance.

“They figured, ‘I might as well get that job before somebody else does,’ ” he said.

Whatever the reasons for the declining number of applicants, the change is good news for the budget, chief economist Gibson said.

“This is extremely significant. Getting a slowdown in people coming in to apply is definitely part of the story of welfare reform and one we may not have been examining enough,” he said.

At an average monthly cost of $155 per recipient, Gibson said, the reduction in applicants has translated to savings of millions of dollars this year.

Because states are now required under federal law to spend the same amount of money on welfare programs as they did in years when the rolls were longer, the drop in applicants “frees up money to spend on things like education and child-care for welfare recipients instead,” Gibson said. “And the money for those things doesn’t have to come from somewhere else.”

Money may also be saved because people will have to choose between working or receiving welfare benefits. National studies in recent years confirm that under-the-table jobs have been common among welfare recipients.

Urban Institute senior researcher LaDonna Pavetti wrote in July 1997 that research based on interviews with single mothers to ascertain how they make ends meet showed many were working while on the welfare rolls, although the work was usually “short-term and relatively unreliable.”

The Urban Institute, a Washington-based think tank, is conducting a comprehensive, multiyear assessment of welfare reform.

Pavetti cited a 1991 study showing that just over half of a group of 50 welfare mothers interviewed in Chicago did part-time or full-time work that they did not report to the welfare department. In a larger study of mothers in four cities, there were similar results: 46% said they had worked while receiving welfare.

Gibson said California welfare fraud had been estimated at as high as 20% in the past. “Reform will certainly wring that out,” he said.

But Pavetti noted that the amount of money earned by most of the women was minimal, accounting for an average of 15% of their total monthly income.

Some experts raise concerns that single mothers and others hard-pressed to make ends meet are being forced below the poverty line by giving up the occasional work and could be required to make devastating choices--whether to feed their children or repair a broken-down car, for instance--as they lose one piece or another of their income.

“Most people don’t realize that receiving welfare does not bring you above the poverty line,” said Doti of Orange County social services.

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Shorter Rolls

New applications for welfare benefits were down sharply statewide from November 1994 to November 1997, the latest month for which figures are available. The pattern was the same in Southern California’s five most populous counties. November applications and percentage change from 1994 to 1997:

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Los San San Angeles Orange Riverside Bernardino Diego Statewide 1994 12,864 2,930 1,945 2,682 3,546 38,958 1997 8,758 1,749 1,346 1,895 2,130 26,405 % decline 32 40 31 29 40 32

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Source: California Department of Social Services; Researched by JANET WILSON / Los Angeles Times