For many low-income single moms, government aid serves as their paid family leave, study shows

(Press-News.org) CORVALLIS, Ore. – The majority of low-income single mothers in Oregon who rely on federal cash assistance around the time of childbirth are in the program for less than a year, suggesting they’re using it as a form of paid family leave, Oregon State University research shows.

The first-of-its-kind study has important implications in the state, which in 2023 established a taxpayer-funded paid family leave program, and throughout the United States as poverty has a particularly high incidence among young children.

“Understanding how mothers use the TANF cash assistance program around birth has been limited by small study samples,” said David Rothwell of the OSU College of Health. “This study shows that TANF is working to support some mothers during this critical life course transition.”

One in six children under age 5 in the U.S. are poor, Rothwell notes, and more than 40% of births are financed by Medicaid, a joint federal and state program providing health coverage to low-income individuals and families.

The study melded Oregon birth data from 2016 and 2017 with participation in the Temporary Aid for Needy Families program. Each year, about 38,000 babies are born in Oregon; as is the case nationally, more than 40% of those births are funded by Medicaid.

Temporary Aid for Needy Families, commonly referred to as TANF, is administered by each state and supported in part by block grants from the Administration for Children and Families, part of the U.S. Department of Health and Human Services. States also contribute to TANF funding.

TANF is the only cash assistance program available to low-income families. In Oregon, first-time, low-income mothers become eligible for TANF in the ninth month of pregnancy, and a family can receive monthly assistance for up to five years total, with some circumstance-based extensions available.

Eligibility requirements vary significantly from state to state, and consequently, so does the percentage of poor families who receive TANF payments; the national average is 21%, Rothwell said, far below Oregon’s average of 49%.

“TANF policy in Oregon is somewhat generous, so in this way the Oregon context is like an upper bound for TANF,” said Rothwell, the Barbara E. Knudson Endowed Chair in Family Policy. “Some may look to this as an example of what TANF could be in their state. Or in some more restrictive states, they may look at the Oregon context and conclude, we never want our TANF to be that generous.”

The research, part of a longstanding partnership between Rothwell and the Oregon Department of Human Services, showed a large spike in TANF enrollment around the time of birth and, among those enrollees, a trend of short-term participation.

“We know that many women lose substantial economic resources during the transition to motherhood, and for low-income women, the loss of work and earnings throws many into or near poverty,” Rothwell said. “When you consider the high burdens associated with TANF applications and the fact that many people don’t apply because of those hassles, the study in all likelihood underestimates the need for cash assistance during this critical phase of life.”

Economic insecurity during the transition to motherhood can be detrimental to health, well-being and family relationships for both mother and child, he added.

The study was funded by the Department of Health and Human Services through its Family Self-Sufficiency and Stability Research Network. Rothwell is one of five scholars selected for the network.

Findings were published in the Journal of Marriage and Family.

A topic for future research is understanding the effect TANF and paid family leave have on each other. Rothwell said there’s significant research evidence suggesting the health, economic and social benefits of paid leave programs, and from the Oregon applicant’s perspective, paid family leave would seem to be preferable to TANF. Paid Leave Oregon replaces 100% of a minimum-wage worker’s wages for 14 weeks, but someone earning $540 weekly at her job would receive $449 monthly in TANF assistance.

“I think paid leave is more appealing than TANF for more than just the higher benefit,” Rothwell said. “While both programs place administrative burdens on applicants, I think there are fewer hurdles associated with applying for paid leave. There also isn’t a stigma attached to paid leave. It seems likely that many would-be short-term TANF users will opt for paid leave now that it’s available.”

Another issue regarding the TANF/paid leave intersection that needs examination is workforce replenishment, he added. In Oregon, for every 100 job openings, there are roughly 66 available workers, with workforce shortages particularly acute in child care, health care and manufacturing.

“Mothers who take Paid Leave Oregon will probably be more likely to return to work than those who take TANF,” Rothwell said. “It’s worth noting, though, that TANF has work requirements; you must work or have a plan to work to get the benefits – that was a big part of welfare reform in 1996. But in Oregon there is a work requirement exemption of up to six months for women who give birth.”

END