Photos by Robin Buckson / The Detroit News Although Tonya Fisher is considered to be at the very pinnacle of success in Family Independence Program, her pay keeps her in the bottom 20 percent of U.S. wage earners.

Poor off welfare, but poverty wins

Low-paying jobs make it a struggle to get ahead

By Gregg Krupa / The Detroit News

    PONTIAC — For Tonya Fisher, welfare reform made the difference between a life of idleness or being a working, productive mom who set an example for her son.

    “If they still had the program where it was continuous welfare and you don’t have to work, you just sit at home, I’d probably weigh 900 pounds and have 80 kids,” Fisher said. “But they made me go to work.

    “It helped motivate me, because I needed the money for me and Bradley,” she said.

    While critics remain, supporters and converts assert that welfare reform has been, so far, the most successful social program for the poor in decades. In Michigan, in the vanguard of the movement toward reform since the early 1990s, cases declined from 226,863 in March 1994 to 73,922 cases in November. The number of cases is now comparable to 1969.

    Forty-five percent of recipients who left welfare in a recent nine-month period say they are “better off” financially, according to a survey financed by the state. And welfare reform generally has succeeded not only in closing cases, but also in at least marginally improving the financial status of tens of thousands of Michiganians, a University of Michigan study shows.

    But nine months before Congress must decide whether to renew the national welfare reform program, the successes are shadowed by some disturbing trends and the ominous cloud of recession.

    Studies suggest that about 60 percent of those who left welfare for work remain poor — off welfare, but still struggling to survive. About 25 percent are unemployed, again.

    Now, there is evidence that the recession is eroding the foundation for the success of the reforms: nearly a decade fertile with employment opportunity. Michigan welfare cases have increased 10.7 percent since their pre-recession low of 66,762. The state projects that they will increase by about 20 percent, from that low, through 2002.

    “When the economy goes down, if you don’t have a real skill or talent that employers need, you’re going to be right back where you started,” said Eleanor M. Josaitis, executive director of Focus:HOPE, a social services program in Detroit that provides employment training for the poor.

    Although Michigan’s welfare overhaul has succeeded in pushing thousands back into the workforce, some problems remain:

• The state does almost nothing to monitor the wages of former welfare recipients, saying, in part, that the program is not intended to fight poverty.

• Only about two in five former recipients say welfare’s Work First program helped them find a job, and less than 15 percent said it had improved their skills.

• Welfare recipients are entering and re-entering the program as many as five and six times before they find adequate employment.

• The rules for welfare recipients get even tougher in January, threatening to compound the failure rate. The state is increasing the work requirement for the program from 30 hours, for most recipients, to 40 hours per week, even though at least 9 percent of recipients are terminated because they can not find 30 hours of work.

Welfare dependency

    When welfare reform began, critics said Fisher was just the sort of person for whom it would not work: a single mother with an irregular work record and a family history of welfare dependence.

    Her family was on and off welfare for years when she was growing up in upstate New York. After leaving the Army, Fisher jumped from job to job without landing a good-paying one. Then, her life was upended by divorce.

    “Low self-esteem, lack of confidence, no motivation, everything,” Fisher said. “I was down in the dumps. I had nowhere to go, nothing to do. I had no house, no car.

    “I grew up in a poor family, and they showed me that it was OK to quit, just by watching them, because they would quit their jobs if they didn’t like them and go on welfare,” she said. “I didn’t want to live like that. But when I got out of the Army, I started to live like that.”

    She turned to the Family Independence Program, the state’s welfare program. Like all recipients who are evaluated as able to work, Fisher was told to enroll in the Work First program and find employment for 30 hours per week. If recipients do not maintain 30 hours, the state declares them ineligible for welfare.

    Work First helps welfare recipients hunt for jobs. Counselors also may place recipients in training and education programs that sometimes count toward their mandatory work requirement.

    Like many welfare recipients, Fisher went through the Work First process twice before finally finding a good job. Now, working 40 hours per week at $11 an hour, she’s off welfare and is supporting her son, with the help of Medicaid.

    “If I had not gotten involved in the program, I probably would have lost my son,” Fisher said. “I would have had to depend on my family, and the divorce says I can’t take Bradley out of the state.”

    While Fisher stands among the welfare successes, for others, the obstacles have proved greater:

• Latoy White, 28, of Pontiac has re-entered the program three times, while taking time off to attend to her four children. She was recently informed that cutbacks may affect her $11-an-hour job at a temporary employment agency beginning next month.

    Yet White has high praise for the program. “More people should try to motivate themselves to participate.” But she knows that even her multiple efforts have led to a less than secure future.

• Tashia McGhee, 29, of East Lansing has managed to meet the work requirements of welfare reform while attending Michigan State University since 1994. But the limited hours she has left for class work have delayed her graduation. She also has used the maximum financing from all her student loans. And the federal government, which provided financing from grants, is pressuring her to graduate.

    She was hoping to graduate in August, but she wonders if the new state work requirement of 40 hours will delay that further.

150,000 working

    Especially during a prolonged economic expansion, the strategy of both mandating work and affirming its worth has been successful in getting Fisher and about 150,000 other people off welfare and back into the workforce since 1994.

    Michigan’s 68-percent decline in caseloads during welfare reform is the second-largest drop in the nation, behind Florida. Almost 40 percent of current recipients in Michigan now earn wages, an increase of about 70 percent since the beginning of welfare reform.

    “Welfare reform has worked far better than I ever would have imagined,” said Wendell Primus, director of income security at the Center on Budget and Policy Priorities. Primus resigned as deputy assistant secretary of health and human services in the Clinton administration, saying he could not abide by the welfare reforms the president signed into law.

    “I never would have anticipated the caseload levels that we have gotten. Nor would I ever have anticipated the employment gains, especially among this hard-to-employ group of single mothers.”

Latoy White of Pontiac has entered the work program three times, but her attempts have not produced a more secure future. The 28-year-old was told recently that cutbacks may threaten her $11-an-hour job.

    But Primus and others say the down-side of welfare reform is that while more people are working, their disposable income — income for spending, saving and investing, after expenses — has barely increased. According to the U.S. Census Bureau, 40 percent of single-mother families increased their earnings by about $2,300 per family on average between 1995 and 1999. But their disposable income increased by only $292, mostly because of taxes and work-related expenses.

    Fisher said that as she moved from welfare to work, she had to scrape to make ends meet. “I had little jobs here, and little jobs there. They did not amount to much.”

    The state helped her with child care and some clothing. But life was a strain. When she finally found a job that paid slightly better, she fell ill after six months and lost it.

    She then reapplied for the welfare program, this time with the intent of getting more education and a better-paying job. She entered a program at Oakland Community College that trained people in information technology.

    Six months of training led to a job with Kelly Services, where she was placed at General Motors Corp. Just recently, she got a different job with a construction company, paying $11 an hour.

    Still, her pay keeps her in the bottom 20 percent of wage earners in the country.

Poverty not reduced

    Even critics of welfare reform acknowledge it has reduced the caseload and put people to work. But they note it has done little to reduce poverty. Nationally, the poverty rate among working single-mother families today is nearly the same as it was in 1995, at about 19 percent.

    “Welfare reform has certainly reduced the rolls,” said Joanne Werdel, a policy analyst for the Center for Civil Justice, a non-profit law firm in Saginaw, that often represents welfare recipients. “A much harder question is whether it has reduced poverty.”

    But federal and state welfare officials, including those at the Family Independence Agency, argue that the program was never intended to do that.

Tonya Fisher, 28, of Pontiac is a welfare reform success story. She got computer training in the state’s Work First program. She says she would have lost her son, Bradley — and her self-esteem and confidence — if she wasn’t working.

    “It was not an anti-poverty program,” said Karen S. Smith, director of communications for the state Family Independence Agency. “The intention, the goal, is to get people off welfare and into jobs. But, I do not think anyone can argue it has not helped to reduce poverty, as well.”

    In fact, the poverty rate overall has fallen in the past decade. In Michigan, it fell from 13.1 percent to 10.2 percent in the decade. But public policy experts debate the cause. Some say the booming economy is almost solely responsible for the drop; others say welfare reform should get more credit.

    Whatever the impact of reforms on poverty, measuring that is such a low priority in Michigan that when the state contacts a sampling of former recipients after their cases have closed, it does not even ask how much money they are making.

    “It’s none of our business, really.” Smith said. “We want to know that they are still employed and not in need of assistance.”

Welfare recipients tracked

    The state did pay for a one-time survey in fall 2000 that tracked two groups of former welfare recipients. It showed their battle with poverty continued. Many had either lapsed into joblessness or were earning poverty-level wages.

    The unemployment rates were high: 22 percent for one group surveyed and 24 percent of the other. About 40 percent of one group and 51 percent of the other earned $8 an hour or less.

    “There are people out there struggling; no question about that,” said Douglas E. Howard, director of the state Family Independence Agency. “And it certainly is very difficult, sometimes. But I think they are far better off in the long run to be struggling at work than not working.”

    A University of Michigan survey of welfare mothers largely supports the findings in the state survey: People are earning somewhat more money, but they still lead difficult lives.

    “We found that those who had made a transition from welfare to work were now objectively and subjectively better off financially than those who remained welfare-reliant,” the U-M survey notes. Working mothers had more pay, reduced rates of poverty, higher household incomes, but they continued to experience similar levels of hardship.

    Fisher said her experience tells her the program works. But even a model former recipient earning a liveable wage is still threatened by poverty, especially in a weakened economy.

    “About a week ago, the boss sat us down and told us that after we come back from Christmas break, because of downsizing, they may be cutting 7 precent of our pay, that there would be no advancement for years and only unpaid vacation,” she said. “It was, like, 'I have to get out of here. I have a 7-year-old I have to take care of.'”

    Her Work First training, and a bit of luck, is helping her persevere. A friend knew of another clerical job with Edgewater Construction in Lake Orion. It also pays $11 per hour.

    “It’s a good opportunity for me, because it’s fast-paced and I can move up real fast. In three months, I could get another raise.

    “I was lucky to find it.”

You can reach Gregg Krupa at (313) 222-2610 or gkrupa@detnews.com.