Too Few Jobs May Imperil Welfare Reform Plan

An independent study offered a sober assessment of welfare reform in Los Angeles County on Tuesday, concluding that the region does not have enough jobs for everyone who needs to work.

The study by the Economic Roundtable, a nonprofit public policy research group, concluded that policymakers will have to revise some strategies if reform efforts are to succeed.

The success of those efforts could have vast social repercussions, affecting the standard of living for millions of Los Angeles residents, the study said, and influencing the viability of the region’s still shaky economic recovery.

The report, obtained by The Times, shows that the number of aid recipients seeking jobs in coming years will vastly outnumber the jobs available--an average of 2.5 job seekers for every new opening. When unemployed job seekers are added to the mix, the ratio increases to 5.4 job seekers for each new opening.

It also offers one of the most detailed accounts of the occupations and industries in which welfare recipients are finding work.

Most are concentrated in a few service occupations--janitors, housekeepers, cooks, waiters and sewing machine operators.

The report, called “By the Sweat of Their Brow, Welfare to Work in Los Angeles,” concludes that these workers rotate in and out of the same low-wage, low-skill jobs over the course of their working lives, earning no Social Security, unemployment or disability benefits.

The report was financed in part by the Arco Foundation and the Liberty Hill Foundation.

One leading economist, however, painted a rosier picture of the ability of the local economy to absorb welfare recipients and contended that current statistics are not keeping up with the region’s barreling recovery.

“I think we are a little better off than they estimate,” said Jack Kyser, chief economist for the independent Los Angeles Economic Development Corp. “The employment numbers don’t give us a complete picture of what’s going on right now.”

The Economic Roundtable report provided this rundown on the Los Angeles County economy to help explain the difficulty of finding jobs for the roughly 150,000 welfare recipients expected to be seeking work under the new welfare reform program.

* Los Angeles County lost 436,700, or 10%, of its jobs between 1990 and 1994 and by 1997 had regained only 168,800.

* Despite the beginning of an economic recovery, unemployment in the county still averages close to 300,000 people.

* The true level of unemployment may be as much as 200,000 to 300,000 higher than official figures because many workers have become discouraged and dropped out of the labor market.

* Although 20% of single mothers in the county’s welfare caseload have strong employment prospects, 60% face formidable odds because of a lack of education, spotty work histories and other factors.

“Regardless of how we view welfare dependency, the reality is that a majority of aid recipients do work and are part of the low-wage work force,” the report states. “We share an important practical interest in seeing welfare recipients successfully employed because the social fabric of the region will be damaged in ways that affect everyone.”

The report is one of the most comprehensive studies to date of the challenges in implementing federally mandated welfare-to-work legislation in Los Angeles County, which has the nation’s largest public assistance caseload.

The new welfare laws place a five-year lifetime limit on aid, with exemptions allowed for 20% of the caseload. Current welfare recipients in Los Angeles County have two years to find work; those who applied for aid after April 1 must find work within 18 months.

In addition, 50% of single parents in California’s welfare caseload must be engaged in some kind of work activity for at least 32 hours a week by 2002, or the state faces steep financial penalties.

The report recommends that state and county officials should set aside local funds to provide for those who can’t find work.

The authors note that welfare reform “raises the prickly question of what mix of understanding, support and pressure is needed to move welfare recipients into employment.” They concede that many other working families are “scrambling to keep the wolf from their own doors” without the benefit of special treatment.

But all Los Angeles residents will derive practical benefits from seeing welfare recipients succeed, they insist.

“We all have a stake in this,” said Daniel Flaming, president of the Economic Roundtable and one of the report’s authors. “I own a home and have roots here in Los Angeles, and I would like to see this be a region that works. If we have growing numbers of destitute families, it’s worse for all of us.”

Flaming suggested that the county will need to revise policies that treat welfare recipients as a single population, taking into account their diversity of needs and tailoring programs individually.

In particular, the report urges that Greater Avenues of Independence, or GAIN, the county’s main welfare-to-work program, should be reviewed. The GAIN program emphasizes jobs over education and skill development, but “it is likely that many recipients are returning to the same jobs in which they previously worked,” the report notes.

However, county officials say many welfare programs to enhance job opportunities for recipients are too new to be counted as successes or failures.

Welfare recipients are finding jobs at a rate of 4,000 per month and projections are optimistic, said Department of Public Social Services Director Lynn W. Bayer.

“Everyone recognizes that we have a tremendous challenge ahead. But we’ve tried to build a program to keep flexibility in place and as for looking at different policies, we’re not there yet,” she said. “We anticipate placing the vast majority of people into meaningful jobs.”

Bayer said preliminary results of an ongoing study of the GAIN program show a more promising outcome than projected by the Economic Roundtable report. But she agreed that the county must develop long-term strategies to boost economic development and job creation.

The report offers a number of recommendations, including providing subsidized jobs to enhance work experience and jobs skills for aid recipients.

It is the first of three studies planned for release over the next few months, with succeeding reports exploring the labor market for occupations offering the most promise for welfare recipients and reviewing the employment outcomes of GAIN participants.