Analyzing Racial Disparities in Welfare Sanctions and Employment Outcomes: A Study of Welfare-to-Work Systems across California Counties during the COVID-19 Pandemic

Background and Research Questions

During the COVID-19 pandemic, the welfare-to-work (WTW) program known as the Temporary Assistance for Needy Families (TANF) encountered unprecedented challenges, with low-income families and particularly single mothers of color experiencing increased economic instability and caregiving demands. This study analyzes welfare sanctions and employment outcomes across the county-level WTW systems in California during the pandemic through a racial equity lens. It addresses these questions: How do welfare sanction rates and employment outcomes vary by race/ethnicity and pandemic status at the county level? To what extent are county-level WTW provisions associated with employment outcomes, and does this association vary by race/ethnic group and pandemic status?

Methods

We utilized non-deidentified records from multiple administrative datasets provided by the California Department of Social Services, including the innovative CalWORKs Outcomes and Accountability Review Data (Cal-OAR). Using advanced multilevel regression modeling, we focused on county-level sanctions (N=7,649) and exits with earnings (N=4,551) data from 2018 to 2023. We controlled for an array of county-level socioeconomic and demographic variables to account for confounding factors. To test the robustness of our findings, we conducted thorough sensitivity analyses, which involved excluding data from smaller counties or racial groups with limited sample sizes and employing alternative measures to ensure the consistency of our results.

Results

Preliminary findings revealed marked racial disparities in sanction rates and exit-with-earnings, which differ across the phases of the pandemic. During the pandemic, Asian and Native American individuals faced higher sanction rates than White individuals, while Black individuals and those categorized as ‘other race’ had lower sanction rates in comparison. Notably, the sanction rate for Asian individuals alone increased post-pandemic. In terms of employment outcomes, Asian and Native American individuals had lower exit-with-earnings rates than their White counterparts, whereas Hispanic individuals showed higher exit-with-earnings rates compared to their White counterparts both before and during pandemic. Notably, specific WTW provisions mitigated adverse effects on sanction and employment outcomes to varying degrees. For example, the counties with higher barrier-removal provisions showed lower sanction rates. These results underscore the complex dynamics of racial disparities within welfare-to-work policies during the pandemic.

Conclusion and Implications

This study sheds light on the racial disparities in welfare sanctions and employment outcomes amid COVID-19. These findings have significant implications for developing WTW policies and practices that promote equity, particularly in times of economic crises.