Local Labor Market Restructuring and the Employment of Welfare Recipients in Los Angeles County

Although welfare rolls have dropped considerably in recent years, most welfare recipients who find work are employed in low-wage, insecure jobs. The problem of "working poverty" is especially acute in large city-regions such as Los Angeles, where local labor market restructuring has created an expanding, low-wage economy, increasingly dependent on immigrant labor. This paper analyzes the employment outcomes of 6,931 women who completed the county's welfare-to-work program in 1996. I evaluate their earnings, labor market segmentation, and job stability. The results show that women were highly concentrated in low-wage service jobs and experienced high levels of turnover and unemployment. Many were unable to obtain employment in the formal labor market. I argue that the struggles of the working poor in a growing regional economy are explained not solely by human capital limitations, but by processes of local labor market restructuring that have contributed to widespread economic insecurity in Los Angeles County.