Gov. Nikki Haley is so proud of the state’s achievements under its welfare-to-work program that she includes highlights of the program on her campaign website.
More than 18,000 people have transitioned from welfare to work under the program since she took office, she said, with 94 percent of those retaining their jobs.
“From the start, getting South Carolinians off welfare and back to work wasn’t about keeping compliance officers in Washington, D.C., happy. It was about getting our citizens back to work,” Haley said in July.
“I give (DSS) Director (Lillian) Koller a lot of credit for helping to change the culture from checking boxes and placement in entitlement programs to a commitment to placement in actual jobs.”
While even Democrats laud the program and the life-changing stories of those finding jobs, some of them say there are legitimate questions about the numbers, the impact of the program on the state’s poverty level and whether the program is placing some families in a more precarious financial spot when those jobs don’t come with benefits.
DSS officials say of the 18,000 who have moved from welfare and SNAP to employment since 2011, most are in jobs that “typically” pay more than minimum wage. Koller said the average wage for those on TANF is $8.35 an hour, while the average wage for those on SNAP, which carries higher income limits, is $8.54.
Some have found jobs that pay as much as $20 or $30 per hour, she said.
She said she doesn’t know if all of the jobs are full-time or permanent. But the state checks job retention and 94 percent still are employed — or at least off welfare — 30 days after being hired, she said. She said the retention rate for those 60 days after starting work is 89 percent.
Many of those who move to jobs don’t stop all government assistance, she said. Some — she didn’t know how many — can elect to continue receiving welfare payments for up to four months after working, though she said her staff discourages that.
Others can qualify for SNAP assistance, though at a reduced amount, or child-care assistance, though the child care disappears after two years.
“The whole welfare-to-work concept gets people off of welfare but we have to make sure people understand that it does nothing to get people out of poverty,” said Sue Berkowitz, director of the South Carolina Appleseed Legal Justice Center, which works with those in poverty. “The poverty level in South Carolina continues to grow and it has grown under her (Haley’s) watch.”
Sen. Brad Hutto, an Orangeburg Democrat, said he approves of any activity that helps people find a job.
“But to make a claim that somehow that these people are being moved from being unemployed to being put into trained, skilled, long-term jobs, I would question that,” he said.
Rep. Bakari Sellers, a Bamberg County Democrat, said he is skeptical about the numbers.
“I don’t know how those numbers came about or if those numbers are, in fact, accurate,” he said. “However, our welfare-to-work program is an essential aspect of what they do at DSS in ensuring that we get people off of welfare rolls and give them opportunities.”
Sen. Thomas Alexander, a Walhalla Republican who chairs the budget committee overseeing DSS, said he would like more information about the numbers and will likely ask DSS officials about the program at a hearing later this fall.
Koller: Program working
Koller said the program is working well and she is addressing the needs of poverty the best way she can.
“There’s a bigger picture out there about the alleviation of poverty,” she said. “The way I alleviate poverty with the resources I have in this department is to get those who can work, jobs.”
The welfare-to-work program grew out of welfare reform efforts that began in the mid-1990s under President Bill Clinton.
Under the program, those in the government’s primary welfare program, the Temporary Assistance for Needy Families, are offered job training, education and job search help to encourage them to find employment. The state generally offers TANF payments for about two years, Koller said. Only about 6,500 of the 34,000 people in South Carolina now on TANF must look for work, she said.
When she first arrived at DSS, she said, the agency was meetingthe federal requirements that welfare recipients participate in “work activities,” which included job searches, education and training. She said she ordered a focus more on getting recipients jobs.
South Carolina also is now working with those who receive food assistance in the Supplemental Nutrition Assistance Program, or SNAP, and are not in TANF, to find jobs.
The government spends about $62 million annually for TANF payments and $2.1 billion for all spending that is administered by DSS. All but $121 million of that is federal money. Koller said much of the increase in the SNAP program in recent years has been the result of the relaxation of verification review rules by the federal government. The state now spends about $1.5 billion on SNAP.
Hutto: Aim should be higher
Hutto said as worthy as the program is, the aim for the state should be to move more of those away from the need for any government assistance.
“If you want to say we’re helping people get some jobs to help them make some money, that’s fine,” he said. “But to say you’re getting people out of the poverty zone, I don’t think that’s accurate.”
Berkowitz said 28 percent of the state’s children live in poverty.
“That number is obscene,” she said. “I don’t think that number is one to be proud of.”
In order to receive welfare, she said, there have to be children in the household. So the numbers show that people don’t leave poverty even when they leave welfare.
“They are doing a little bit better, but we could do a lot better for the people of this state,” she said.
According to a recent national study by the Cato Institute examining the value of welfare benefits versus the value of work, South Carolina ranked 31st among states in the percentage of welfare recipients involved in what the federal government considers a work activity, which includes jobs, training, searching for work and education. The study reported that 42 percent of South Carolina recipients were involved in a work activity.
Koller said she doesn’t believe those numbers are accurate but she didn’t know what the percentage of those in work activities are. She said most in TANF aren’t required to look for jobs because they are children or disabled or otherwise exempt.
The study concluded that current benefits act as a “disincentive” for work. In 33 states, including South Carolina, the hourly wage equivalent of selected government benefits, even after accounting for the Earned Income Tax Credit, still exceed the minimum wage, according to the study. In South Carolina, the value of those benefits equals $10.53 per hour, according to the study.
Study results questioned
But Koller and others say the study is flawed because they don’t know of any recipient receiving all the benefits used in the study.
DSS officials, in releasing welfare-to-work numbers this summer, said that even those who earn minimum wage in the state still net more financially than those who are on welfare and receive food assistance.
They say in such a situation, a parent with two children (the family model used in the Cato study), would earn $1,661 a month while working but only $761 in welfare and food assistance if not working. The DSS example for working parents, however, includes $344 in food assistance.
Some Democrats say that job benefits, especially health insurance, are critical when comparing jobs versus welfare.
“Have we really helped anybody when we moved them into a job that does not have benefits, that is not allowing health coverage on one hand and we are not accepting (expanded Medicaid) coverage?” asked Rep. Gilda Cobb-Hunter, an Orangeburg Democrat who helped craft welfare reform legislation in the state in the 1990s.
“One problem struggling families have is how are we going to cover everything? Particularly those with kids. So you wind up with a parent who does not have health care. These people are caught up in a difficult situation.”
And Hutto says that the DSS working-versus-welfare example makes a point he thinks is important. He said 85 percent of those who move off welfare and into jobs still qualify for food assistance. Koller said she doesn’t know where Hutto found the 85 percent number but said it wasn’t from DSS. She said she didn’t know what the number is.
Berkowitz said that mothers who find a job have their child-care assistance cut in half after their first year of working and the benefit is eliminated after the second year, even though those working aren’t likely to receive pay increases to cover the added cost of child care.
Rep. Rita Allison, a Spartanburg County Republican who serves on the House budget-writing committee and was among the lawmakers asking for a legislative audit of DSS on child protection issues, said one of the challenges faced by welfare recipients is training for a more demanding job market.
Alexander said while he wants more information about the program, he believes welfare-to-work is a good idea. And he said he fondly remembers testimonials in the early days of welfare reform of people who had moved into jobs, increasing their self-esteem and outlook on life.
Allison said the program has great value, even with its challenges.
“I think as a state, we realize this is an area we need to put energy into and help people maneuver from the welfare system into the workforce,” she said.
“We have quite a bit of economic development opening up in the state. And with that we need a skilled, educated workforce and this is a real opportunity for those people who’ve found themselves on welfare to transcend into these jobs.”