Almost three years after a radical overhaul of the nation's welfare system, the most comprehensive independent study to date confirms that the rolls have fallen more dramatically than anyone expected, but warns that many of those leaving welfare for the work force struggle to afford basic life essentials.
Conducted by the Urban Institute, this first thorough national assessment of welfare reform in many respects affirms the triumphant message President Clinton plans to carry to Chicago today, where he will attend a conference aimed at coaxing the private sector to hire welfare recipients.
Clinton, administration officials said yesterday, will come armed with the news that there are now some 7.3 million people on welfare nationally -- down from 14.1 million when he took office in 1993, and from 12.2 million when he signed the Republican-drafted welfare overhaul in August 1996.
That experiment, which dramatically divided Democrats and Clinton's own White House, is proving largely successful in its early stages, according to both official administration studies and the more neutral Urban Institute review. Clinton today will release a report from his Council of Economic Advisers asserting that about a third of the decline in welfare caseloads is due to the 1996 overhaul, and only about 10 percent is due to the robust performance of the economy.
The Urban Institute study, however, also includes some sharp warnings about the precarious position of the poor at a time of general national prosperity, and suggests that many people who leave public assistance remain trapped on the lower rungs of the economy. In particular, most women who leave welfare are working in low-wage service jobs, and a significant minority say they have trouble providing food for their families or paying rent, the study concludes.
"More than a quarter work night schedules, and over half are struggling with coordinating work schedules and child care," the report concludes. "At least two thirds do not have insurance from their employer."
Despite these cautionary notes, Clinton will arrive at the conference with a better case to make on behalf of welfare reform than even many on his own team thought likely three years ago. White House aides agonized for weeks about whether Clinton's general support for welfare reform -- a concept he had promoted for years -- would be enough to overcome what Democrats viewed as the deep deficiencies of the Republican bill.
At the time, centrist Clinton policy aides such as Bruce Reed and political advisers such as consultant Dick Morris argued that overhauling welfare was a critical opportunity for Clinton to implement the "New Democrat" themes he had run on. Against these voices, Health and Human Services Secretary Donna E. Shalala urged that Clinton hold out for a better bill from the Republicans. And some liberals in her department, including longtime Clinton friend Peter Edelman, resigned in protest once Clinton signed the bill.
Since the bill became law, Clinton has been able to correct some of the elements he considered shortcomings, including restoring benefits for legal immigrants who were in this country before the overhaul was signed. But Congress so far has not approved benefits for legal immigrants who arrive after 1996.
Against that backdrop, Clinton's appearance before the Welfare to Work Partnership, a group he organized, will have a note of vindication. "Skeptics underestimated how much everyone wanted to abandon the old system, and how well recipients and businesses and states would respond to a chance to start over," said Reed.
All 50 states have met the work requirements imposed by the overhaul, the administration said this week. And while about 35 percent of welfare recipients are now working, Reed said, only a small percentage of recipients have been thrown off the rolls by the welfare bill's time limits on benefits.
But Eli J. Segal, president of the Welfare to Work Partnership, said Clinton and the business executives gathered in Chicago are trying to avoid a triumphant message. Segal said the conference is focused on "the hard nuts and bolts" of finishing the job of moving people off public subsidies, and he acknowledged that "many of the people who have made the transition are just hanging on . . . they've gone from welfare to poverty, the hardest stage."
Still, the not-for-profit group can claim significant successes. Some 12,000 businesses have joined the group, and hired 410,000 welfare recipients. Sixty-five percent of the member businesses have found that welfare hires have a higher retention rate than other new hires.
The conference takes place at a time when the first wave of studies analyzing the effects of welfare reform is confirming two undeniable victories: First, more adults are leaving the welfare rolls at a faster rate than anyone, critics or supporters, expected. And second, at least half of them are finding work.
To reform's supporters, such bright numbers are proof enough that the overhaul, for the moment, is working. But to enduring critics on the left, those are blind statistics, meaningless and even deceptive without a broader explanation.
"The reduction in rolls begs the question: What kind of jobs at what kind of wages?" said Sen. Paul D. Wellstone, a consistent critic of the reform.
The Urban Institute study surveys women who stopped receiving benefits between 1995 and 1997, mostly before welfare reform took effect in most states. Still, by tracking "leavers," it aims to predict effects of the law.
Of the 2.1 million adults who reported leaving the rolls during that period, 60 percent had jobs at the time of their interviews -- mostly entry-level work such as food or cleaning service or retail, earning an average of $6.61 an hour. Some, however, had gone back on the rolls at some point in the period -- an option few will have in the future. About a third left the rolls without finding work; the study offers only guesswork about their support.
Most of those with jobs do not have health insurance. Half say they worried that food would not last until the end of the month, or report skipping meals in the last year. Forty percent say that on one or more occasions they could not pay rent, utility bills or the mortgage.
But critics say the real moment of judgment will come later, when the strong economy weakens, when the easier cases have already left the rolls and only the difficult ones remain, or when the last term limits kick in for most states, about three years from now.