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News Release

SUCCESS STORY CONTINUES FOR WELFARE WORK PARTICIPATION RATES

HHS Secretary Tommy G. Thompson announced today that all 50 states, the District of Columbia, and Puerto Rico met the fiscal year 2001 overall work participation rate required by the welfare reform law. The average overall participation rate increased from 34 percent in fiscal year 2000 to 34.4 percent in fiscal year 2001.

"We have shattered the cycle of dependency and we are creating a cycle of opportunity for millions of American families, thanks to the welfare reform law of 1996," Secretary Thompson said. "Now, the Senate must follow the House's lead and pass President Bush's visionary approach to the next step of welfare reform, which will help more people go to work and climb the career ladder to build better lives for themselves and their families."

In fiscal year 2001, the law requires states to meet a 45 percent overall work participation rate and a 90 percent work participation rate for two-parent families in their Temporary Assistance for Needy Families (TANF) programs. However, these rates are reduced by a state's caseload reduction credit.

"The only way for the welfare family to escape the cycle of poverty is for the government to provide the motivation and resources for recipients to move into full-day, full-year work," said Dr. Wade F. Horn, assistant secretary for children and families. "President Bush's welfare reauthorization initiative now pending before Congress will raise work participation rates while providing child care, transportation, and other resources for helping Americans enter, continue in, or return to the work force."

This is the fifth consecutive year that all states subject to the welfare reform law's overall work requirement have met the work participation requirement. Only the territories of Guam and the Virgin Islands failed the overall rate. Fourteen states exceeded the 45 percent statutory standard without using their caseload reduction credit and 28 states had sufficient caseload reduction credits to drop their standard for the overall rate to zero.

Of the 35 jurisdictions subject to the 2-parent rate (33 states, D.C. and Guam), 30 met the rate objective. Rhode Island and Wyoming met the two-parent standard without using their caseload reduction credit. Illinois and Wyoming had sufficient caseload reduction credits that their standard for the two-parent rate dropped to zero. Arkansas, Minnesota, Mississippi, the District of Columbia and Guam did not meet the two-parent participation rate and are subject to financial penalties. (Seventeen states and two territories do not have any two-parent families in TANF, and are not subject to this requirement.)

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Last Revised: October 15, 2002