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TANF Emergency Fund Jobs Provide an Alternative to Welfare

South Carolina is one of 30-odd states that are using the TANF Emergency Fund to help create nearly 200,000 subsidized jobs across the country — and one of many states that will have to start shutting down their programs in the next few weeks if Congress fails to extend the fund.  States are using the fund, which Congress created in last year’s Recovery Act, to help cover the wages for private- or public-sector jobs for low-income parents and youth, including people who would otherwise qualify for cash assistance through the regular TANF (Temporary Assistance for Needy Families) program.

To find out how South Carolina’s program is faring, I recently spoke with Linda Martin, the state’s TANF director, and Gilda Kennedy, the chief architect of the subsidized employment program.

What have you accomplished through your subsidized employment program?

We’re using this program to keep our TANF cash assistance caseloads down.  We’ve had tremendous growth in our TANF caseload since the start of the recession.  But ever since we started this program, our TANF caseload has been going down, even though our food stamp caseload is still increasing.  We expect to place 600 people in jobs before the program ends in September.  We could place many more if Congress extends the program.

Who participates in the program?

When job-ready individuals come in to apply for TANF, instead of putting them on the cash assistance rolls we immediately refer them to a job developer who recruits employers who are willing to hire them in exchange for a short-term subsidy.  We reimburse employers for 20 hours of work at the minimum wage for six months.  Many employers pay workers for more hours (and some pay more than the minimum wage), but the amount of the subsidy doesn’t increase.  When the six months are up, employers are expected to keep the workers on staff and cover their wage costs.

What kind of feedback have you gotten?

Participants have told us the program has been life-changing.  Even a part-time, minimum wage job gives them more money than being on TANF.

Our job developers are enthusiastic as well — they want to know why we haven’t been doing this from the beginning.  They now understand what it means for TANF to be a work program and believe this is how it should be done.

Providing the subsidy has allowed us to attract employers we haven’t been able to attract to our welfare employment program before.  And just about all the participating employers are in the private sector.

What does the future hold?

There’s obviously a continuing need for this program and we desperately want to keep it running, but we won’t be able to if Congress doesn’t extend the TANF Emergency Fund.

In fact, we will stop making job placements at the end of July if Congress doesn’t extend the Emergency Fund before then.  And that would be a terrible shame.