ABSTRACT
The relationship of welfare to the labor market can be direct, indirect, or nonexistent. All welfare income accruing to the household from Aid to Families with Dependent Children (AFDC), AFDC-Unemployed Father, or state General Assistance is included, regardless of which member receives it. Policy that adds to the stock of jobs in the secondary labor market will promote more mixing of work and welfare, not a permanent, durable substitution of work for welfare. Policies which tighten labor markets, at both the national and local levels, will reduce the utilization of welfare. The extent to which a policy of job creation promotes a permanent substitution of work for welfare depends, however, on the quality of the new jobs as measured by such factors as remuneration and stability. The implications for welfare reform policy are therefore clear— and will be difficult to swallow, especially for Washington planners.
