There is no conflict of interest.
Citation
Edelhoch, M., Flynn, C., & Liu, Q. (2021). Impact of South Carolina's TANF program on earnings of new entrants before and during the Great Economic Recession. Journal of Social Policy 50(4), 871-890. https://doi.org/10.1017/S0047279420000677
Highlights
- The study's objective was to examine the impact of South Carolina’s Family Independence (FI) program on participant’s earnings.
- The study used a nonexperimental design to compare the outcomes of FI recipients to a matched comparison group of non-recipients. Using administrative and unemployment insurance wage data, the authors conducted statistical models to compare differences in outcomes between the groups.
- The study did not find any significant relationships between participation in South Carolina's FI program and earnings.
- This study receives a low evidence rating. This means we are not confident that the estimated effects would be attributable to the FI program; other factors would have likely contributed. However, the study did not find statistically significant effects.
Intervention Examined
The Family Independence Initiative
Features of the Intervention
South Carolina's Temporary Assistance to Needy Families (TANF) program, known as Family Independence (FI), emphasizes a ‘work first’ approach. It has penalties for those who do not participate in work activities and maintain a shorter benefits duration than required. To receive TANF funds, participants must start job searching immediately. They also need to take part in classes to improve their job application and employment skills. Those who remain unemployed for two months after enrollment receive additional training and job search assistance, plus referrals to external services like vocational rehabilitation and mental health support. The maximum monthly benefit for a family of three is $205, which is lower than the national average, and the program targets low-income adults and children in South Carolina who qualify for TANF funding.
Features of the Study
The study examined the effects of South Carolina's FI program on the earnings of participants during the challenging economic period of the 2007-2009 recession. It used a nonexperimental design, comparing a group of successful FI applicants and a matched group of applicants who were not enrolled in FI. The comparison group included those who either did not complete their application, had income or resources above the limit, or were deemed ineligible for FI. The eligible participants were single mothers who applied for FI and received food stamps.
The study included three cohorts. Cohort 1 applied in February and March of 2007, Cohort 2 in February and March of 2008, and Cohort 3 in February and March of 2009. To ensure comparability, the authors used administrative and unemployment insurance wage data to form matched groups. Each cohort consisted of pairs with similar characteristics, including unemployment rates, earnings prior to intake, whether or not they were African American, education levels, average parental age, and number of children. The matched cohorts included 964 pairs in 2007, 1,137 pairs in 2008, and 1,336 pairs in 2009. The study analyzed earnings over three quarters following the intake to assess the impact of the FI program during a time of rising unemployment. The authors used statistical models to compare the earnings of those who participated in the FI program with those who did not.
Findings
Earnings and wages
- The study did not find any significant relationships between participation in South Carolina's FI program and earnings.
Considerations for Interpreting the Findings
The authors created a matched group of applicants who were not enrolled in South Carolina’s FI program to compare to successful FI applicants. They matched participants based on factors like age, race (specifically if they were African American), unemployment rate, and UI earnings. However, they did not consider or match other races and ethnicities as required by the protocol. These preexisting differences between the groups—and not the FI program—could explain the observed outcomes. Therefore, the study is not eligible for a moderate causal evidence rating, the highest rating available for nonexperimental designs.
Causal Evidence Rating
The quality of causal evidence presented in this report is low because the authors did not ensure that the groups being compared were similar before the intervention. This means we are not confident that any estimated effects would be attributable to South Carolina’s FI program; other factors would have likely contributed. However, the study did not find statistically significant effects.