NCPA - National Center for Policy Analysis

Families Stabilize Under Minnesota Welfare Plan

June 1, 2000

The Minnesota Family Investment Program, the state's blueprint for reforming welfare, achieved highly positive results, according to a study conducted by the Manpower Demonstration Research Corporation. The beneficial effects included higher earnings and income for parents, less poverty, an increase in marriage rates and marital stability, as well as improvements in children's behavior.

The downside was that the program was substantially more expensive than other approaches.

  • Minnesota required welfare recipients to work and counselors emphasized that if beneficiaries took jobs -- even low-wage jobs -- they would be substantially better off than if they stayed on welfare.
  • Accordingly, the proportion of welfare recipients with jobs rose by 35 percent -- and many of the jobs provided stable, full-time employment.
  • Earnings increased by 23 percent -- to an average of nearly $8,000 a year for each person working.
  • Average income, from earnings and welfare combined, rose 15 percent -- to $10,800 a year.

Domestic abuse decreased by 18 percent, marriage rates soared by 50 percent, and parents said their children performed better in schools and had fewer behavioral problems.

However, the program was more expensive than Aid to Families With Dependent Children, the pre-reform system. The new approach cost $1,900 to $3,800 a year more per family, over five years.

Sources: Robert Pear, "Changes in Welfare Bring Improvements for Families," New York Times, June 1, 2000; and Cheryl Wetzstein, "Minnesota Welfare Plan Costly, Effective," Washington Times, June 1, 2000.

 

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