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March 27, 2018
Temporary Assistance for Needy Families: Work Requirements
Introduction
For FY2016 (the latest year data are available), 12 states
The Temporary Assistance for Needy Families (TANF)
received no credit and faced the full 50% standard for all
block grant helps states fund public assistance programs for
families, while 20 states had this standard reduced to 0%.
needy families with children, usually headed by a single
Thus, 20 states could have no recipients working or
mother. TANF was created in the 1996 welfare reform law,
engaged in activities and still meet the TANF standard.
with a goal of ending dependence on assistance through
work and job preparation. This In Focus discusses TANF
What Counts as Engagement in Activities?
work requirements, summarizing and extending the analysis
There are detailed rules about what activities count, when
in CRS Report R44751, Temporary Assistance for Needy
those activities count, and how many hours recipients must
Families (TANF): The Work Participation Standard and
be engaged in activities for them to count toward meeting
Engagement in Welfare-to-Work Activities. Despite the
the state’s work participation standard. Federal rules permit
work requirements, only a minority of non-employed
states to count as “engagement” working at a job while
TANF assistance recipients are engaged in activities such as
simultaneously receiving assistance (“unsubsidized
job search, subsidized employment, community service, or
employment”), or participation in work and job preparation
education and training in a month.
activities, which include job search and readiness,
education and training, subsidized employment, community
Federal TANF Work Requirements
service, and work experience programs. TANF’s rules limit
The federal TANF work requirements apply to states, rather
the counting of job search, job readiness, and education
than individual recipients. Most prominent is a numerical
training. This reflects a “work-first” philosophy, which
performance standard—a minimum work participation rate
seeks to move recipients quickly into jobs.
(WPR)—that each state must meet or risk a penalty that
would reduce its block grant. It is this numerical standard
Figure 1. Federal TANF Work Participation
and its detailed rules that are commonly referred to as the
Standards and State Work Requirements
TANF work requirement. The standard was intended to
provide accountability, while giving states flexibility to
meet TANF’s goals.
While the federal participation standard may help shape
states’ decisions about their work requirements for
individual recipients, it is the states that determine what
those requirements look like. States decide whether or not
to provide assistance to working low-income parents. States
also decide who among the non-working recipients must
participate in activities, what activities they must engage in,
and how many hours are required.
The Work Participation Standard
In order for the state to meet the work participation
standard, (TANF) statute requires that states have either
working, or engaged in activities, 50% of “all families” and
90% of families with two parents. Families are excluded in
the WPR calculation if they do not have a “work-eligible”
individual (e.g., grandparents caring for a child) or are
otherwise exempt (e.g., single parents caring for an infant).
Source: Congressional Research Service (CRS).
WPR Targets Vary by State and Year
Further, the statutory percentages may be reduced by
WPRs Achieved by States
credits. The main credit is for caseload reduction, which has
Figure 2 shows the TANF WPR for FY2002 through
played a large role in TANF. The assistance caseload fell
FY2016. For the period from FY2002 to FY2011, the
from 5.1 million families in March 1994 to 1.4 million in
national WPR held fairly steady, around 30%. Beginning in
March 2017. Much of this decline resulted from states
FY2012, the WPR began to increase, and in FY2016 it
serving fewer eligible families, rather than declines in the
exceeded 50% for the first time.
number of families eligible for benefits. Currently, each
state receives credits for the total caseload reduction that
The figure divides the WPR into three participation
has occurred in it since FY2005.
categories: (1) welfare-to-work activities, (2) unsubsidized
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Temporary Assistance for Needy Families: Work Requirements
employment in regular TANF programs, and (3)
Table 1. Participation in Activities by Non-employed
unsubsidized employment in “earnings supplement
Work-Eligible Individuals, FY2016 (monthly averages)
programs.” Earnings supplement programs are separate
Total Non-employed,
from regular TANF programs, with states providing
538,078 individuals
(100%)
Work-Eligible Individuals
working parents a relatively small benefit ($10 to $50 per
month). Some earnings supplement programs are for those
Engaged in activities
123,821 individuals
(23%)
who left regular TANF programs; others may have no
connection to the regular programs. Some states add a $10
Not engaged in activities
414,258 individuals
(77%)
TANF-funded amount to a working parent’s Supplemental
Source: Congressional Research Service (CRS) tabulations of the
Nutrition Assistance Program (SNAP) benefit, regardless of
TANF National Data Files, 2016. Excludes individuals in “earnings
their past connection to TANF assistance. Almost all of the
supplement” programs.
increase in the WPR since FY2012 has come from
unsubsidized employment in earnings supplement
Conclusion
programs.
The TANF work participation standard is intended to
provide accountability for state programs. States generally
Figure 2. TANF Work Participation Rate,
have met the standard through credits for caseload
FY2002-FY2016
reduction and unsubsidized employment, which reflect
goals of TANF. However, the TANF work participation
standard has not resulted in engagement in activities beyond
a minority of the non-employed caseload. Some of the
unsubsidized employment is not connected with the regular
TANF assistance program. Additionally, the caseload
reduction has resulted primarily from a reduction in the
share of TANF-eligible families receiving benefits, rather
than declines in the number of families eligible for benefits.
The experience of TANF illustrates the difficulty of using
performance measures to affect state policy. The 50% and
90% targets are aspirational, rather than evidence-based.
They were not selected based on success rates of past
programs in moving recipients from assistance to work.
Source: Congressional Research Service (CRS) tabulations of the
They call for higher participation rates than what evaluated
TANF National Data Files, 2002-2016.
pre-1996 programs achieved, including the most successful
of those programs. Even so, the standard has mostly been
State Penalties
met, though usually by means other than engaging
Historically, most states with WPRs below 50% have been
recipients in activities. That is, states might be “hitting the
able to meet their participation standard for all families
target, but missing the point.”
because of credits. States that failed to meet the standard
Should Congress seek to raise participation among the non-
entered into “corrective compliance plans” and avoided the
employed, it could consider revising the participation
penalty by subsequently meeting the standard. More states
standard (e.g., ending the credits or revising the treatment
failed the 90% two-parent standard than failed the 50% all-
of some types of unsubsidized employment). TANF’s
family standard, but the former is penalized to a lesser
history is not encouraging for such efforts. Legislation
degree under program rules. Additionally, many states have
enacted in 2006 attempted to close perceived loopholes in
avoided having to meet the two-parent standard altogether
the standard, but this did not result in higher participation in
by assisting two-parent families outside of TANF.
job preparation activities. States found new ways to meet
Engagement of Non-employed
the standard without engaging more non-employed
Recipients in Welfare-to-Work Activities recipients.
Caseload reduction and unsubsidized employment have
Congress might also consider measuring performance based
played a large role in helping states meet the work
on employment outcomes, such as the share of those who
participation standard. Participation in activities among
leave the rolls and enter employment. That approach raises
non-employed recipients has played a smaller role. For
questions of whether states could “game” those measures as
FY2016, Table 1 shows that out of 538,000 non-employed
well, and how to set the outcome targets to reflect an
recipients in an average month, 124,000 (23%) were
effective program. Alternatively, Congress might consider
engaged in reported activities. Thus, more than three out of
different approaches or program structures to provide states
four TANF non-employed individuals were not reported as
incentives or requirements to engage a greater share of non-
engaged in activities. FY2016 was not an atypical year:
employed recipients in activities.
over the FY2002-FY2016 period, the highest percentage of
non-employed individuals engaged in activities was 27%.
Gene Falk, Specialist in Social Policy
IF10856
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Temporary Assistance for Needy Families: Work Requirements
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