Decline in income for one-third of welfare leavers.

OTTAWA -- One out of three person leaving welfare experienced a significant decline in family income says the first national study on the economic outcome for people who stopped receiving welfare benefits. Most people who left welfare during the 1990's saw their family's income rise.

The study, Life after welfare: the economic well being of welfare leavers in Canada during the 1990's, based on data collected from Statistics Canada's Longitudinal Administrative Databank was published by Statistics Canada.

The study covers people who left welfare between 1992 and 1997 and studies those who primarily relied on social assistance, about 80 per cent, for one year of their total annual income.

Two years after they left welfare, the report indicates that

* 30 per cent had significantly lower family incomes than they had received while on social assistance;

* average family income after welfare was only about one-third of their average income while they received social assistance benefits;

* Jobs provided little income for these people after they left welfare.

For instance, one third of the people who received benefits in 1992 and who had left the system within two years, had average family earnings from a job of $1500 in 1994. However, the study notes that this income improved somewhat with time reaching $12,000 per year in 1998, which returned family income to the levels they had received while on welfare.

However, for 6 out of 10 people who left welfare the average family income rose "quite dramatically for some."

For those who experienced the largest increase in family income after leaving welfare their average after-tax income was 2.4 times higher or about $33,600 per year compared to $13,900 in welfare benefits. Job earnings accounted for most of these income gains and their level of earned income remained about the same for next five years. Rising employment opportunities and a growing economy were factors in this change.

Marriage or common law relationships also had a favorable impact on average family incomes especially for lone-parents and unattached people on their leaving welfare.

The report indicates that those who married, were two to three times more likely to leave welfare than others primarily due to the employment earnings that were brought to the family through marriage. The study reports that:

* Single women who left welfare after marriage, had spouses who contributed more than three-quarters of family earnings;

* Single men who married and left welfare, had a new spouse who contributed one-half of the family income.

Access to report go to Website: communityaction.ca