This article examines the relationship between work and welfare in poor, female-headed families by tracing the process through wich single mothers work their way off welfare. Analysis is based on montly data from the Panel Study of Income Dynamics (PSID) for the years 1984-86. The results reveal substantial labor market activity among single mothers on welfare not previously found in studies of welfare dynamics analyzing anual data. A majority of women work while they are on welfare, and more than two-thirds of welfare exist occur through work. Human capital investments are key determinants of welfare exits through work, while a large family size impedes particularly rapid job exits from welfare.
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