Employment of Former Foster Youth as Young Adults: Evidence From the Midwest Study

Purpose: Since at least the late 1980s, when federal policy first began to focus on preparing foster youth for independent living, the importance of preparation for employment has been paramount. In spite of this policy focus, little is known about the employment outcomes of former foster youth during early adulthood and the factors associated with those outcomes. We explore how former foster youth in Illinois, Wisconsin, and Iowa are faring in the labor market and what explains variability in employment outcomes for these youth. First, we describe trends in former foster youths' employment from age 17 to 24. Then, we consider how former foster youths' characteristics and experiences are associated with their employment and wages.

Method: We analyze youth's employment at all four waves of the Midwest Study, predicting employment with stable characteristics observed at the first interview (such as race and type of living arrangement at exit) and characteristics that may vary each time a youth is interviewed (such as educational attainment and whether the youth is a parent). We use multilevel models with observations at each wave nested within individuals. We use logistic regression to predict employment over 20 hours per week. We then use OLS regression to predict log wages among those employed.

Results: By age 24, just under half of former foster youth in the Midwest Study are employed, and most are working full time. The majority of youth who are not employed are actively searching for work. Controlling for other characteristics, we find that black youth, mothers, and youth who were not living in traditional family foster care on the verge of transition were substantially less likely to be employed. As expected, youth with a GED or a high school diploma are almost twice as likely to be employed as youth who did not complete high school. Youth with some college attendance or an Associate's degree are over three times as likely to be employed, and earn about 5 and 17 percent higher wages, respectively. In Illinois, there is evidence that the number of years in care from age 18 to 21 increases wages by 2.8 percent per year, amounting to 8.4 percent higher wages for youth who remain in care until age 21.

Implications: First, these findings point to a critical need for further research in several areas. We need to better understand and address a) barriers to education, b) causes of substantial racial disparities, and c) characteristics of family foster homes that facilitate youths' employment. Second, this research highlights the need for policies directed at current and former foster youth who become parents early. And while further research is needed, these findings provide some justification for states to adopt the Fostering Connections Act provisions allowing the extension of foster care past 18. Third, this research highlights the importance of better coordination between the child welfare system and other institutions that serve young adults, particularly with the criminal justice system for young men, and with institutions involved with young low-income parents for young women.