From 1975 to 1978, during his first term in office, Governor Michael Dukakis oversaw a period in which the unemployment rate dropped by half from 12 percent to 6 percent. At the same time, the Aid to Families with Dependent Children (AFDC) caseload in Massachusetts increased by 10,000. As a result, Governor Dukakis initiated the Employing and Training (ET) Choices Program at the beginning of his second term in 1983. Designed as a route out of poverty, ET was particularly important because welfare benefits in Massachusetts had dropped substantially below the federal poverty level during the four years Governor Dukakis was out of office. Although welfare benefits were only 1 percent below the federal poverty level in 1978, from 1978 to 1983 benefits were increased only 16 percent while inflation increased 40 percent. ET is designed to alleviate poverty through employment in meaningful, unsubsidized jobs. The program’s goal is to place 50,000 welfare recipients into full- or part-time jobs over 5 years.
At the time of program initiation, there were approximately 110,000 households on public assistance in the state (including AEDC recipients). The maximum annual cash grant that Massachusetts provides an AFDC mother with two children is $5,400. This family is also eligible for about $1,800 in food stamps for a total annual income of roughly $7,200, which is 20 percent below the federal poverty line of $9,120 for a family of three. By contrast, the full-time jobs obtained by ET participants are paying over $10,000 a year, or 10 percent above poverty level.
The strategy of ET is to provide the training and services necessary for welfare families to obtain jobs with wages high enough to rise out of poverty. Since October 1, 1983, more than 24,000 individuals have obtained full- or part-time jobs through ET. After deducting the costs of the program, ET will save an estimated $107 million in reduced welfare benefits and new revenues from income and sales taxes and Social Security contributions in just one year. While nationwide welfare caseloads have grown despite a decline in the national unemployment rate, the Massachusetts AEDC caseload has gone down as a result of ET.
Since its inception in October 1983, ET has been available to all adult and teenaged recipients of AFDC (over 90 percent of the approximately 85,000 AFDC families are headed by single mothers). Since December 1984, ET has also been open to the approximately 25,000 adult recipients of GR (these individuals are largely single adults without children). ET has provided approximately 8,000 businesses in Massachusetts with a trained and motivated supply of labor from a pool of people who have traditionally been regarded as among the most challenged in terms of securing permanent employment.