Urban Institute: The Role of TANF During the Recession

written by Catherine An

August 18, 2011

This month, our friends at the Urban Institute released a brief on the role of TANF during the recession. The news is not so good. According to researchers Sheila Zedlewski, Pamela Loprest, and Erika Huber, TANF did not play a significant role in keeping families economically stable during the recession. In fact, there were many states in which the number of people enrolled in the TANF program declined (this study specifically looks at years 2007 to 2010) while unemployment rose dramatically. Of particular note is the state of Arizona, where TANF rolls declined by 48 percent while unemployment in Arizona rose by 134 percent. The finding is curious. TANF is meant to assist poor families with cash assistance and promote self-sufficiency and work. Why then, during a time of economic turmoil and high unemployment, would poor families not take advantage of TANF benefits? Reduced TANF use has left a number of families in dire financial situations, what the writers of the brief call “disconnected.” “Disconnected” families have no earnings of cash government assistance of any kind. The writers found that in 1996, one in eight low-income single mothers was disconnected; that jumped to one in five disconnected single mothers from 2004 to 2008. And this is the kind of economic vulnerability that leads to homelessness. Mainstream welfare programs, like TANF, are often a bridge for many poor people and families between homelessness and housing. Most poor people – and people who become homeless are typically poor people – have scant resources. Depriving a family of even one of those resources can lead the family to tumble into homelessness. At the end of the brief, the Urban Institute recommends policy measures that could improve the utility and effectiveness of the TANF program, especially during recessionary periods. Among the recommendations are:

• encouragement of subsidized job programs
• allowing training and job education to count towards work activity requirements during times of high unemployment
• permitting federal block grant funds to rise automitcally for states experiencing high unemployment

And finally, the brief concludes with a sentiment that is often felt in our offices. While the temptation to cut such social programs, especially in this fiscal environment, may loom large, we must not forget the role that these precious programs play in the lives of people who have few if any other resources. To read the full brief by the Urban Institute, please visit their website.