Sep 12, 2013 | Permalink »
Subsidized Employment Helps Long-Term Unemployed Reconnect to Workforce
Stimulating Opportunity, a new report from the Economic Mobility Corporation, highlights the role subsidized employment programs can play in reconnecting long-term unemployed workers to the workforce. This report examines in depth the experiences of workers and employers who participated in subsidized employment programs in five sites under the Temporary Assistance for Needy Families (TANF) Emergency Fund. As CLASP documented, between 2009 and 2010, 39 states used TANF Emergency Funds to support subsidized employment opportunities for more than 260,000 workers.
Stimulating Opportunity finds that, even after the subsidy period has ended, subsidized employment can have a significant positive impact on low-income job seekers’ employment and earnings. These effects were largely concentrated among those job seekers who had been unemployed for more than six months prior to starting the program. While comparison group data was only available for one site, Florida, the pattern of employment in other sites appears consistent with these findings. This suggests that, in a period of limited resources, subsidized jobs programs may wish to target participants without recent work experience.
Aug 19, 2013 | Permalink »
Support for Low-Income Families Falls Again
Spending data released by the Administration for Children and Families shows that state spending of Temporary Assistance for Needy Families (TANF) and related state maintenance of effort (MOE) funds declined again in federal fiscal year 2012. States reported spending or transferring to related programs a total of $31.36 billion, down nearly $2 billion from fiscal year 2011.
As a result, spending declined in nearly every category on which TANF and MOE funds may be used. The categories with the largest decreases were basic assistance (down $622 million), child care (down $500 million, including both spending within TANF and transfers to the Child Care and Development Block Grant) and work-related activities (down $485 million, driven largely by a $356 million decline in spending on wage subsidies). The category with the largest increase was “other non-assistance” with a $129 million increase. Data collected from the states in 2011 showed that this category was used to report spending in a wide range of areas, but that the largest shares were spending on child welfare services and TANF program expenditures such as case management.
Most states had less federal TANF funds available to them in FY 2012 than in FY 2011, as they had less carryover funds from the TANF Emergency Contingency Fund (ECF) remaining. Three states were required to return a portion of their awarded funds based on reconciliation of their final spending reports. This process also led to many states retaining the remaining carryover funds as unobligated balances. In addition, the 17 states that had historically received additional funding from the supplemental grants also experienced the loss of these grants, which were not funded in 2012. Total state spending climbed while MOE fell by $693 million, with California accounting for $317 million of that decline.
Jul 29, 2013 | Permalink »
Few TANF Applicants Test Positive for Drug Use; Testing is Costly and Ineffective
Legislative Update: Governor Pat McCrory (R) of North Carolina vetoed HB 392, a bill that proposes suspicionless drug testing bill of TANF recipients; stating that the bill is unfair and fiscally irresponsible with potential operational problems. “This is not a smart way to combat drug abuse,” Governor McCrory said. “Similar efforts in other states have proved to be expensive for taxpayers and did little to actually help fight drug addiction. It makes no sense to repeat those mistakes in North Carolina.”
This year alone, at least 30 states have brought forward proposals to screen or chemically test individuals applying for public benefits for drug use. Kansas and Texas recently enacted suspicion-based drug testing for TANF (Temporary Assistance for Needy Families) and Unemployment Insurance applicants, respectively. As we have discussed, drug testing public benefit applicants is ineffective, costly, and stigmatizing. This proof can be found in data from states that have already implemented drug testing laws.
Drug Testing is Ineffective: Results from drug testing in Oklahoma, Utah, and Florida show the ineffective nature of these laws. Of the 1,300 applicants screened in Oklahoma between November 2012 and February 2013, 340 were identified as possible users and required to submit to drug testing. Only 16 individuals, or 1.2 percent of TANF applicants, failed the test. In Utah, a 2012 drug testing law yielded an even lower rate; of the 4,425 individuals who were screened, 394 applicants had to submit to a drug test, with just nine failing the test. In total, only 0.2 percent of TANF applicants failed the drug tests. Similarly, when Florida instated a universal drug testing policy on TANF applicants, only 2.6 percent failed the drug test.
Drug Testing is Costly: Some claim drug testing will save states money. In reality, the cost of the testing program far exceeds any savings from denying benefits to poor families. Florida spent $118,140 implementing their universal testing law and saw a net loss of $45,780. Pre-screening before testing is less costly than testing all applicants; however, overall costs are still high. In Oklahoma, each screening cost $20 and chemical tests added $141. Within four months of implementing drug testing, costs totaled $74,000. This cost could have skyrocketed to more than $183,300 if every applicant had been required to submit to a chemical test instead of being screened first. Limited resources should be spent on making needed treatment available, rather than on broad-brush testing regimes.
Drug Testing Stigmatizes the Poor: Drug testing policies are based on the assumption that many applicants for public benefits are poor because of their bad choices, such as substance abuse. However, the evidence confirms that only a small fraction of applicants are drug users. These policies burden and stigmatize the vast majority of applicants who are not using drugs, and can prevent poor families from accessing needed benefits. Moreover, these policies may deter those parents who do have addiction issues from receiving treatment or rehabilitative services.
CLASP opposes drug testing as a condition of public benefits receipt. Instead of spending on drug testing, states should focus on ensuring treatment is available to all those who seek it.