The Welfare of Rural Welfare Reform

By Laurie Thompson, Director of Programs, NADO Research Foundation

In 1996, United States welfare programs changed dramatically as the Personal Responsibility and Work Opportunity Act (PRWORA) ended entitlement programs and established welfare-to-work initiatives. The Temporary Assistance for Needy Families (TANF) replaced Aid to Families with Dependent Children (AFDC), emphasizing the shift to moving families off of welfare and into jobs.

TANF was designed to give states more flexibility in crafting programs, and individuals were required to assume greater financial responsibility for themselves and their dependents.

As the specifics of TANF unfolded, it was expected that the rural poor would not fare as well as the urban poor. Fewer jobs, inadequate public transportation, limited childcare options and insufficient job training programs created obstacles for rural welfare recipients. USDA’s Economic Research Service (ERS) found in 2000 that despite decreases in rural and urban unemployment rates, the gap between the two increased as rates fell more slowly in rural areas.

An article in USDA’s Rural America (Reforming Welfare: Implications for Rural America, December 2001) reported that:

Finding a job is not often the issue for the rural poor – finding a job with a living wage is the challenge: Annual earnings for poor rural mothers, was $6,131 in 1999.

50 percent fewer families are receiving funds through TANF than through the former AFDC program, with the drop in assistance comparable in rural and urban areas. 2001 data show the decline may be leveling off, or in some cases reversing.

The level of availability of licensed childcare facilities, job training and public transportation directly impacts welfare-to-work programs in rural areas. However, rural welfare recipients are more likely to have informal support networks making it easier to secure employment.

Rural America also reported that four groups of legislative options could promote greater self-sufficiency of welfare-dependent families:

Making work pay would help increase financial stability through state earned income tax credits, expansion of the federal earned income tax credit, greater health care benefits, higher minimum wage and more training programs.

Addressing barriers to work in rural areas would increase public transit, change income guidelines to allow recipients to own reliable cars and increase childcare opportunities.

Helping multiple barrier families – those with lower skill levels, drug and alcohol problems, mental health needs or disabilities – would offer new public sector job options or training venues.

Helping persistently poor areas, such as the Delta and Appalachia, would extend time limits and work requirements.

For More Information Contact: The Welfare Information Network at 202/628-4200 or www.welfareinfo.org.

Legislative Update

The Bush administration introduced its FY 2003 TANF reauthorization proposal with a request of $16.7 billion. The funding level is the same as FY 2002, but the president plans to replace the bonus to reduce out-of- wedlock births with initiatives that focus on building stronger families, reducing teen pregnancies and promoting healthy marriages.

Rural Facts

Rural areas provide fewer job options than urban areas, and they tend to be part-time and minimum wage.

Although accounting for 19 percent of the population, non-metropolitan areas account for only three percent of the labor force growth.

Low population densities in rural areas hinder the development of workplace supports and infrastructure such as education and training, childcare and public transportation.

Food stamps assistance has declined less in rural than urban areas due to fewer eligible recipients and a large number that chose not to participate.

Source: Rural Dimensions of Welfare Reform Conference, May 2000

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