Milwaukee New Hope Project

THE NEW HOPE PROJECT, Inc., was a communitybased organization located in Milwaukee, Wisconsin. This organization operated an antipoverty employment program, the New Hope Project, between August 1994 and December 1998. The New Hope Project's underlying principles were that people who are willing to work full-time should be able to do so, and that they should not be poor when they do work.

New Hope provided services to any adult who worked full-time (at least 30 hours per week), lived in one of two targeted low-income areas in Milwaukee, and had an income that was at or below 150 percent of the federal poverty level. Participants in the New Hope program, conditional on their willingness to work full-time, [Page 718]were eligible to receive 1) an earnings supplement to raise their income above poverty (after utilizing federal and state Earned Income Tax Credit benefits); 2) subsidized health insurance; and 3) subsidized childcare. For workers who were unable to find full-time work, the program placed participants into a wage-paying community service job.

The benefit structure was designed in part to address the contradictions found in a number of welfare and workfare programs, where participants were forced off public assistance and into the labor market, yet lacked work supports (for example, childcare) and earnings, such that after working full-time they still found themselves earning below the poverty threshold. Almost 90 percent of adult participants were single mothers and 80 percent of all participants received public assistance before entering the program.

An important component of the New Hope Project was its design as a demonstration program that involved a randomly selected subsample (the treatment group) who received benefits, and the remainder (the control group) who were denied benefits while tracked to provide a counterfactual to program participation.

The purpose of random assignment was to avoid the selection issues that accompany the fact that participants may systematically differ from nonparticipants, biasing the treatment effect of the program. Milwaukee residents in both programs participated in surveys, focus groups, individual interviews, and ethnographic research. The emphasis on both quantitative program evaluation and qualitative ethnographic analysis provided rich data to appraise the success of the New Hope Project.

In a climate of welfare reform, the New Hope Project represented a genuine attempt to address the hypocrisies of conventional work-based welfare programs that required participants to work yet provided few work supports, which could make private employment a viable alternative to home-based work such as childrearing.

The findings from the five-year evaluation of the program suggest that while receiving New Hope benefits, workers in the treatment group experienced higher incomes and worked more than observationally similar workers in the control group, yet these gains quickly disappeared once the program expired. This somewhat surprising result is symptomatic of the “work first” focus of New Hope, which placed emphasis on labor force attachment, not on human capital accumulation that would provide training and help workers climb career ladders.

Aimed to go beyond conventional expenditure programs for the poor, and designed to “make work pay,” the New Hope program was focused primarily on labor force attachment as opposed to strategies to foster human capital accumulation. The institutional climate of the pilot assistance program is worth noting. Milwaukee hosts the youngest African-American population out of 100 of the largest U.S. metropolitan areas, hence the importance of poverty programs that address the well-being of children and attempts to lift their families out of poverty via labor market interventions.

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