Jill Marie Gunderson and Julie L. Hotchkiss
Working Paper 2006-7
May 2006

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This paper uses a unique personnel data set and state administrative data to follow welfare and nonwelfare hires who separate from similar jobs with the same firm. Welfare hires are more likely to separate from their job and are more likely to be on welfare after separation compared with similarly low-skilled nonwelfare hires. Those not returning to welfare, however, are no more or less likely to have moved on to a lower- or higher-paying job than nonwelfare hires.

JEL classification: H53, J31, J62

Key words: welfare, welfare-to-work, separation behavior, multinomial logit, switching regression, administrative data

This research benefited from discussions with John C. Robertson and from research assistance provided by Suzanne Zurkiya. The views expressed here are the authors’ and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Any remaining errors are the authors’ responsibility.

Please address questions regarding content to Jill Marie Gunderson, ERS Group, 4901 Tower Court, Tallahassee, FL 32303, 850-562-1211, ext. 140, 850-562-3838 (fax), jgunderson@ersgroup.com, or Julie L. Hotchkiss, Georgia State University and the Federal Reserve Bank of Atlanta, Research Department, 1000 Peachtree Street, N.E., Atlanta, GA 30309-4470, 404-498-8198, julie.l.hotchkiss@atl.frb.org.

For further information, contact the Public Affairs Department, Federal Reserve Bank of Atlanta, 1000 Peachtree Street, N.E., Atlanta, Georgia 30309-4470, 404-498-8020.