Labor Market Outcomes of Women

This chapter provides an overview of recent changes in the income support system for lowincome families in the State of California, and describes some of the associated changes in the labor market outcomes of women. Although much attention has focused on federally-initiated welfare reform associated with the 1996 Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), significant welfare reforms were adopted in California in the 1980s and early 1990s. Moreover, many of the changes associated with PRWORA, such as time limits and mandatory work, have only been partially implemented or have not yet had time to reach their full effect. Other income support programs, in particular the Earned Income Tax Credit, have also changed over the past decade. This rapidly evolving program environment, coupled with the effects of the strong economy, make it very difficult to assess the impact of any single component of welfare reform. Nevertheless, the outcomes of lower-income workers and their families are changing. Welfare caseloads in California fell by 50 percent from January 1996 to early 2000. The fraction of welfare recipients who work has risen from less than 10 percent to over onethird. And after rising sharply in the early 1990s, poverty rates among single-female-headed families have begun to fall. All these changes suggest that cumulative reforms in the income support system is having some effect in California.