Poverty and Welfare in North Carolina

1
Poverty and Welfarein North Carolina

• Dr. Dennis K. Orthner, Professor
• School of Social Work and Dept. of Public Policy
• Associate Director, Jordan Institute for Families
• The University of North Carolina at Chapel Hill
• February 2006

2
Poverty in North Carolina

• Presentation Objectives
• Examine distribution of poverty in North Carolina
• Examine trends and patterns in welfare exits and
  returns among TANF families
• Understand the impact of welfare reform on the
  next generation TANF children
• Review the issue of fathers in poverty

3
Key Questions about Poverty

• What does it mean to be poor or in poverty?
• What is economic self-sufficiency?
• What does it take to be economically
  self-sufficient today?
• Why is poverty so difficult to eliminate?

4
Official Poverty vs. Lifestyle Poverty

• Poverty Income Annual
• 1 Person 9,570
• 2 12,830
• 3 16,090
• 4 19,350
• 5 22,610
• Low Income (USDA) 30,000
• Median Family Income (NC) 53,400

5
Poverty in North Carolina

• 13 of citizens in poverty
• 62 counties above state average of poverty
• 16 of all children in poverty
• 22 of children under 6 in poverty
• 40 of children on free/reduced lunch
• 36 of children on medicaid
• 10 of elderly in poverty
• 66 of the poor have a full-time working adult

6
Common Poverty Myths

• 1. All poor are long-term. Most are not.
• 2. All welfare recipients are long-term. The
  average time on welfare for a recipient is 3
  years.
• 3. Most poverty is found in our nation's inner
  cities. Poverty is just as concentrated in our
  rural areas.

7
Current trends

• Drop in real income for three-fifths of the
  population
• Growing percent without health insurance
• - 13 of NC children uninsured
• Percent of working poor families rising
• - 62 of single 85 of two-parent low-income
  households have full-time working parents
• Educational completion rates very low
• - 59 complete high school in 4 years
• Literacy levels still low for the poor

8
Family Strengths in NC

• A strong family is one that has these assets
• Economicmanage finances, makes ends meet
• Communicationtalk and share ideas
• Problem-solvingwork together to solve crises
• Social supportconnections to others
• Family cohesionunity and share values
• Religious supportspiritual life

9
Significantly different between all groups at
0.05 significance level. Significantly
different between low income and high income
families at 0.05 significance level.
10
Work Firstin North Carolina
11
Work First Caseload

• 63 African-American
• 6 Hispanic
• 50 with child 5 and younger
• 36 on welfare for 6 or fewer months
• 1 of cases have two parents
• 50 of cases are child only

12
NC Work First Caseload Drop
13
NC Work First Exit Rates
14
The Number of Months Families Receive Work First
Benefits
15
Child Only Cases as Percent of Total
16
Work First Exits-Returns Key Findings

• Most recipients exit in 2 years but returns to
  welfare common
• Work experience most important to work-related
  exits high school diploma has no impact on exits
  but positively impacts earnings.
• Increases in wage rates and decreases in
  unemployment rate increase exits from welfare.
• Labor market conditions and human capital are
  more relevant to the exits of black women.
• Black women work more than white women but slower
  to exit and faster to return. Black women more
  likely to have a lost earnings return.
• Presence of young children increases likelihood
  of return.

17
The Next GenerationChildren in Poverty in North
Carolina
18
EOG Reading Trends
19
EOG Math Trends
20
EOC English Trends
21
EOC Algebra Trends
22
Drop Out Rate for Poor Children-I
23
Drop Out Rate for Poor Children-II
24
(No Transcript)
25
(No Transcript)
26
Summary of Findings

• Overall patterns of reading and math performance
  are poor for TANF children, especially
  African-American children
• The gap in performance between White and Black
  children remains
• Dropout rates are increasing and higher for white
  children than for black children
• Mothers employment is beginning to show small
  positive effects on school performance

27
Welfare Reform, Phase III Strengthening Couples
Families
28
The Family Triangle A Reminder
Child
Mom
Dad
29
Couples Children Today Current
Realities

• One-third of children born to unmarried parents
• 23 White
• 43 Hispanic
• 68 African-American
• Half of children with married parents experience
  divorce
• Multi-partner fertility (Fragile Families)
• 60 of unmarried parents (either or both) have a
  child from another relationship (24 if married)

Carlson Furstenburg, 2003
30
Low-Income Couples Current Realities

• Rapid decline in couple and co-parenting
  relationships
• 100 together at conception
• 82 romantically involved at birth
• 49 living together
• 60 say they want to marry each other (55 of
  moms)
• 49 romantically involved one year later
• 9 marry within one year
• 32 living together
• 42 have no romantic relationship at all

31
The Costs of Not Strengthening Low-Income Couples

• Continuation of current trends
• Majority of children living at some time in a
  one-parent home
• High reliance on government assistance
• Increased marginalization of men
• Decline in assumption of marriage or stable
  couple relationships

32
Benefits of Strengthening Couples Poverty
Reduction

• Effectiveness of 5 factors in reducing poverty
  rate
• Full-time work - 42
• Marriage (to 1970 rate) - 27
• Education (to HS) - 15
• Reduce family size (to 1970) - 13
• Double case welfare - 8

Sawhill and Haskins, 2004
33
Benefits of Strengthening Couples Reduced Family
Violence

• Risks of child-abuse increase 400-500 when
  non-biological father in the household
• Sexual predators often target children in
  single-parent families
• Data from Fragile Families indicates most couples
  are highly supportive of each other and conflict
  levels quite low

Wilson 2002
34
Benefits of Strengthening Couples Stronger
Children

• Married and cohabiting dads more likely to
• Feed, read to and play with their children
• Father engagement and love (compared to
  mothers)
• Equally predicts social, emotional, and cognitive
  development
• Equally predicts happiness, well-being, and
  social and academic success
• Better predicts delinquency and conduct problems,
  substance abuse, and overall mental health and
  well-being

Carlson McLanahan, 2001 Rohner Veneziano,
2001
35
Benefits of Strengthening Couples Stronger
Children

• Children from two-parent biological families
  demonstrate better behavioral, educational and
  developmental outcomes compared to children from
  one-parent families including
• Higher socioeconomic achievement
• Better psychological well-being
• Higher rates of high school college
  completion
• Less teenage childbearing
• Less idleness in young adulthood

Amato Booth, 1997 McLanahan Sandefur, 1994
36
Benefits of Strengthening Couples Stronger
Communities

• Economic well-being
• - Median family income highest among married
  (42,000) vs. cohabiting (33,000), divorced
  (19,000) single-parents (13,000)
• Health indicators more positive for couples
  compared to singles and single parents
• Unplanned pregnancies lower for married
• Communities with more married-parent families are
  safer and less likely to have substance abuse and
  crime among young people

1998 data from Federal Reserve Board Thornbury
et al., 1999
37
The Time is Now

• Refocus our low-income programs on the whole
  family
• Actively include dads in family support
• Build couple development into programs
• Recognize that stronger couples lead to stronger
  kids... and communities!

Child
Mom
Dad
38
Poverty in NC Where do we go next?

• Give more attention to children of Work First
  parents
• Provide after-employment coaching to participants
• Support education and training for employed
  parents
• Offer more assistance to fathers and partners
• Take a family-centered approach to welfare
  assistance

39
Conclusions

• Poverty is widespread - and now growing again
• Current strategies target the most poor and women
• Weak strategies for the working poor, men and
  couples
• Poverty problems spill over to other income
  groups
• Comprehensive community-based strategies needed