Indicator: 62 - Leaving Welfare to Jobs That Pay a Living Wage

Why This Is Important

Federal welfare reform (launched in the mid-1990's under the Temporary Assistance to Needy Families program, or TANF) has greatly changed welfare systems across the nation, requiring recipients to find work or enter training programs in order to receive assistance, and setting time limits for such assistance. Many families have in fact left the welfare rolls across the country, and quite a few studies have examined whether these households earn living wages sufficient to meet basic household needs. If income is insufficient, children and families suffer. Communities capable of meeting the needs of children and families need to be able to help families in their transition from welfare to work that pays a livable wage.

Data on this measure for Maine is limited. As noted under Maine Mark #42, achieving a livable wage is a problem for many Maine families even if they have not received TANF assistance; about two-thirds of the jobs in Maine have paid what the Maine Economic Growth Council considers a liveable wage (185% of the federal poverty level for a family of two). To achieve that definition of a liveable wage, a two-person family with full-time employment would need an hourly wage of about $10.

In November 2000, Maine's Department of Human Services reported that 7,171 of the state's TANF caseload was considered able to work, and about 34% were in fact doing so. However, their average wage at placement was only $6.50 to $7.00 an hour, depending on the month. This mirrored national experience. A 2001 report from the Urban Institute ("Initial Synthesis Report of the Findings from ASPE's 'Leavers' Grants," available at http://aspe.hhs.gov/hsp/leavers99/synthesis01/index.htm) found that about 60% of those leaving welfare were working at any given time after exiting TANF; they usually worked full-time earning $7.00 to $8.00 an hour, with their income staying near the poverty line.