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The impact of welfare reform on local labor markets

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  • Laura Leete
  • Neil Bania

    (Center on Urban Poverty and Social Change at Case Western Reserve University)

Abstract

We develop a local labor market information system to assess the labor market effects of recently adopted welfare reform laws. Using the Cleveland-Akron metropolitan area as a prototype, we develop an occupationally and geographically specific inventory of projected job openings and measure the skill mismatch between projected job openings and the welfare population likely to enter the labor market. We find the skill mismatches are quite large: Following implementation of reform, welfare recipients entering the labor force would initially have to claim anywhere from 34 to 61 percent of expected low-skill job openings in order to become fully employed. Labor market opportunities are further diminished if one takes into account the effect of gender and space in limiting job accessibility. Welfare recipients entering the labor market as a result of reform would require from 40 to 75 percent of jobs remaining if predominately male occupations are removed from consideration. The AFDC recipients who depend on public transportation, even in extraordinarily long commutes, can access only 40 to 44 percent of entry-level job openings. © 1998 by the Association for Public Policy Analysis and Management

Suggested Citation

  • Laura Leete & Neil Bania, 1999. "The impact of welfare reform on local labor markets," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 18(1), pages 50-76.
    • Handle: RePEc:wly:jpamgt:v:18:y:1999:i:1:p:50-76
    DOI: 10.1002/(SICI)1520-6688(199924)18:1<50::AID-PAM4>3.0.CO;2-S
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    References listed on IDEAS

    as
    1. Yellen, Janet L, 1984. "Efficiency Wage Models of Unemployment," American Economic Review, American Economic Association, vol. 74(2), pages 200-205, May.
    2. David C. Ranney & John J. Betancur, 1992. "Labor-Force-Based Development: A Community-Oriented Approach to Targeting Job Training and Industrial Development," Economic Development Quarterly, , vol. 6(3), pages 286-296, August.
    3. Keith Ihlanfeldt, 1992. "Job Accessibility and the Employment and School Enrollment of Teenagers," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number jaes, November.
    4. Gueron, Judith M, 1990. "Work and Welfare: Lessons on Employment Programs," Journal of Economic Perspectives, American Economic Association, vol. 4(1), pages 79-98, Winter.
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    Cited by:

    1. Thomas E. Lambert, 1998. "The Poor and Transportation: A Comment on Marlene Kim’s “The Working Poor: Lousy Jobs or Lousy Workers?”," Journal of Economic Issues, Taylor & Francis Journals, vol. 32(4), pages 1140-1142, December.
    2. Frank Howell, 2000. "Prospects for 'Job Matching' in the Welfare-to-Work Transition: Labor Market Capacity for Sustaining the Absorption of Mississippi's TANF Recipients," JCPR Working Papers 202, Northwestern University/University of Chicago Joint Center for Poverty Research.
    3. Neil Bania & Laura Leete & Claudia Coulton, 2008. "Job Access, Employment and Earnings: Outcomes for Welfare Leavers in a US Urban Labour Market," Urban Studies, Urban Studies Journal Limited, vol. 45(11), pages 2179-2202, October.
    4. O'Regan, Katherine M. & Quigley, John M., 1999. "Spacial Isolation and Welfare Recipients: What Do We Know?," Berkeley Program on Housing and Urban Policy, Working Paper Series qt1mz642ft, Berkeley Program on Housing and Urban Policy.

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