IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this book chapter

Examining the Effect of Industry Trends and Structure on Welfare Caseloads

In: Economic Conditions and Welfare Reform

Previous studies of the macro-economic determinants of welfare caseloads have had difficulty in explaining changes in welfare caseloads during the last decade or so using the simple macroeconomic measure of unemployment. Because welfare recipients will typically get entry- level jobs, employment variables that are closely related to job vacancies, such as employment growth, are also important in determining welfare caseloads, as we show empirically in this study. Recognizing that welfare recipients face more substantial barriers to employment than those who typically have more education and skills, we constructed several macro-economic variables that reflect the education requirements of industries and the predominance of low-skilled workers hired by various two-digit sectors. Estimates based on a data set of annual time series observations aggregated to the state level suggest that these variables help in explaining welfare caseloads. More specifically, areas with higher concentrations of industries that hire welfare recipients and demand workers with higher education levels have higher caseloads. Based on a separate set of metropolitan-based estimates, we also found that gross job flows are positively correlated with welfare caseloads, with job destruction dominating the effects. While the two sets of results come from different types of estimation and for areas with different levels of aggregation, the results suggest that skill levels required of industries and the dynamics of the local labor market, which go beyond the typical measures of unemployment rate, help to explain the anomalies in changes in welfare caseloads during the past decade. The findings underscore that welfare recipients have barriers to employment that are different from the rest of the labor force and thus variables that more closely reflect their circumstances should be considered in explaining welfare caseloads. These findings are relevant to those attempting to predict caseloads at the na

(This abstract was borrowed from another version of this item.)

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

in new window

This chapter was published in:
  • Sheldon H. Danziger (ed.), 1999. "Economic Conditions and Welfare Reform," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ecwr.
  • This item is provided by W.E. Upjohn Institute for Employment Research in its series Book chapters authored by Upjohn Institute researchers with number ecwrch5.
    Handle: RePEc:upj:uchaps:ecwrch5
    Contact details of provider: Postal:
    300 S. Westnedge Ave. Kalamazoo, MI 49007 USA

    Phone: 1-269-343-5541
    Fax: 1-269-343-7310
    Web page:

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:upj:uchaps:ecwrch5. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.