Getting Down to Business: Matching Welfare Recipients' Skills to Jobs That Train

Abstract

Having moved 1.4 million families off the nation's welfare rolls during the past two years, federal, state, and local policymakers can take pride in the progress they have made through their workfirst initiatives. With many of the more capable recipients now employed, however, the hard part of this reform effort has arrived. It is time to take a deep breath and gauge how things are going - and are likely to go - for former recipients and their families. States are already moving forward on midcourse corrections to policy and programs, based on what policymakers are learning. This article details research that can help ensure that welfare as we now know it is not only efficient in moving people from welfare to work, but also effective in achieving sustained employment and financial independence. Two years after implementing the Temporary Assistance for Needy Families (TANF) program, it is clear that a robust labor market has created enough jobs to absorb the first wave of former welfare recipients into the labor force. A careful look, however, reveals a stark mismatch between many welfare recipients' skills and the skills required to get, and successfully perform in, the good jobs the new economy is creating - jobs that lead to self-sufficiency. As welfare reform proceeds, it will be important to assess individual welfare recipients' skills and skill requirements in particular jobs to ensure successful matching of recipients to jobs that provide lasting employment. At the same time, gauging on-the-job training opportunities available in different occupations provides avenues for skill development at work - outside the traditional educational system - that can facilitate upward mobility. The end result is that connecting information on client skill, occupational skill requirements, and access to on-the-job training can lead to better placements, thereby improving longer-term outcomes for families. The Scope of the Study This article summarizes some of the findings from a larger study that examines the role of skills in determining the job prospects and economic well-being of welfare families, both in the near term and long term. The findings are based on the National Adult Literacy Survey (NALS), which measures the educational achievements and job-related skills of the entire U.S. population, including individuals who identify themselves as welfare recipients. Using both academic and applied questions to assess skill, NALS measures both what individuals know and what they can do with what they know. In addition, this data source includes information on each recipient's demographic characteristics, employment, income, education, and training activities. Linking the NALS assessment data to detailed industries and occupations, educational requirements, training opportunities, earnings, and employment projections enables us to evaluate the fit between welfare recipients' skills and the best available jobs. The framework that results connects the supply of welfare recipients with labor market demand, using actual skill assessments on both sides of the employment equation. One-Third at a Time In building a labor-market framework that matches available workers with projected new jobs, the recent results of the nation's work-first policy are confirmed: many welfare recipients have skills that enable them to find employment. Some recipients qualify for jobs where work experience and employer-provided training will spur further income mobility, but a significant proportion demonstrate skills that limit their prospects to jobs with low earnings and limited opportunity, to learn at work. For the top one-third of these welfare recipients - those with the most skill - the job itself may be the best trainer. At the same time, these are the recipients for whom education investments would bring the highest returns. Roughly another one-third of welfare recipients are employable but probably not in jobs with a future. …

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