Congress Needs to Rethink U.S. Poverty Programs and Reauthorize TANF

By Taylor Maag

People who live on the margins, without jobs in this tight labor market, face obstacles and lack skills that make it difficult for them to find meaningful employment. 

Some people receive aid from federal public assistance programs, such as Temporary Assistance for Needy Families (TANF), a block grant to states that provides assistance to low-income families with children.

In the third blog in our series on the new Congress. JFF’s policy team delves into TANF. Our conclusion:  to ensure economic mobility for all, Congress must reauthorize TANF, making changes to the law that ensure program participants have access to skills development and comprehensive support services. 

The Need for Reform

TANF was created in 1996, but there have been no updates to the law in more than 20 years. The law was the successor to Aid for Families with Dependent Children and was designed to move individuals out of poverty through a strong focus on work. The initial effects were relatively positive for individuals who were ready to work, but participants with complex barriers or skills deficits remained unemployed or were placed into low-wage jobs. This resulted in many beneficiaries who lost needed benefits or who were trapped in low-wage jobs without the skills needed to advance. 

In the 1990s, at a time of full employment, policymakers assumed that simply getting TANF recipients a job would put them on a path out of poverty. In 2019, the U.S. has a very different economy. Today, the percentage of jobs requiring at least some postsecondary education and training are at record highs, resulting in worker shortages in high-demand jobs. Indications are that the future of work will heighten these discrepancies, yet only 9 percent of federal and state TANF funds are used for work-related  activities. An even smaller amount of these resources are available for education and training.

It is critical to change the thinking on this, and other poverty-alleviation laws, to focus on skills attainment, so both employers seeking workers and individuals seeking careers can benefit. Taking just any job, with no focus on skills development, is no longer enough for individuals who receive TANF benefits. These recipients, who encompass 1.4 million families, have been historically underrepresented in postsecondary education and high-demand industries. They are part of America’s untapped workforce, and will continue to be left behind in our economy if things do not change.

Looking to the future

JFF believes a reauthorization of TANF is essential to helping recipients and their families find employment in family-supporting careers and to reduce barriers to employment, such as lack of transportation or child care. Actions by Congress in 2018 show that there is growing support for updating anti-poverty programs that are related to skills development strategies. To maintain this progress and ensure that TANF is reformed to help its clients acquire the skills they need for economic success and self-sufficiency, the following policy changes should be made: 

• Increase TANF’s focus on skills development and eliminate work participation rates and time limits on training.
• Create new success measures. Ensure that TANF performance metrics include measures on employment, retention, earnings, educational progress, and credential attainment, refocusing the law again on skills attainment and job quality.
• Increase funding for education, skills attainment, career navigation, and support services. More funding is needed for these activities to ensure that TANF provides comprehensive services that reduce barriers and allow participants to attain credentials that will lead to jobs in high-demand industries.

JFF has long supported programs and strategies that prepare disadvantaged individuals, like those in anti-poverty programs, for family-supporting careers. We believe good jobs are key to economic mobility, but a job alone, without adequate supports and without a focus on skills development, cannot help most individuals on public assistance dig their way out of poverty.

To address these challenges, it’s imperative that policymakers continue to work together to reach a compromise and pass a bipartisan reauthorization of TANF. Such action has the potential to eliminate ambiguous restrictions on education and job training and offer increased opportunities for skill development for Americans, who through no fault of their own, are struggling to meet basic needs.