9 Measuring Employment and Income for Low-Income Populations with Administrative and Survey Data

ciliation Act (PRWORA) of 1996 and the expansions of the Earned Income Tax Credit (EITC) over the past decade, increasing attention has been paid to the employment experiences, labor market earnings, and transfer income received by disadvantaged individuals and households. This attention, prompted by explicit performance goals in PRWORA and implicit goals of the EITC expansions, focuses on whether low-income households can achieve self-sufficiency without resorting to Temporary Assistance for Needy Families (TANF) for other public assistance programs. Although income and employment levels are only partial indicators of the well-being of households, they continue to be ones most often used to assess the consequences, intended and unintended, of welfare reform. More broadly, good measures of income and employment for low-income families are necessary to (1) assess the well-being and labor market attachment of low-income and welfare populations at the national, state, and local levels; (2) evaluate welfare reform and learn the effects of specific policies, such as time limits and sanctions; and (3) meet reporting requirements under TANF and aid in the administration of welfare programs. There are two data sources for measuring employment and incomes of the disadvantaged: survey data and administrative. Surveys have been the mainstay of evaluating welfare programs and of monitoring changes in income and em-ployment for decades. These include national surveys—such as the U.S. Cen