This paper uses a unique personnel data set and state administrative data to follow welfare and nonwelfare hires who separate from similar jobs with the same firm. Welfare hires are more likely to separate from their job and are more likely to be on welfare after separation compared with similarly low-skilled nonwelfare hires. Those not returning to welfare, however, are no more or less likely to have moved on to a lower- or higher-paying job than nonwelfare hires.
JEL classification: H53, J31, J62
Key words: welfare, welfare-to-work, separation behavior, multinomial logit, switching regression, administrative data
This research benefited from discussions with John C. Robertson and from research assistance provided by Suzanne Zurkiya. The views expressed here are the authors’ and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Any remaining errors are the authors’ responsibility.
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