This report looks at the unemployability of today's poorest welfare recipients, homeless families, and explores avenues for overcoming their obstacles to gainful employment. These impediments cannot be addressed with traditional job training or immediate placement. Instead, it is job readiness (skills, knowledge, and work ethic) combined with education that is the key to equipping all welfare recipients with skills and knowledge necessary for meaningful, permanent full-time employment. The homeless mother receiving welfare typically has not completed high school, reads at a sixth-grade level, has never worked, and bears sole responsibility for her young children. The fewer than 4 in 10 who have worked have had part-time, short-term, and almost exclusively low-wage sector positions. The provision of job training has been the routine response to welfare dependence, but standard training programs usually require basic literacy skills that homeless welfare recipients do not have. In addition to maintaining unrealistic eligibility standards, most training programs focus almost exclusively on teaching work skills. Few offer child care and transportation assistance, and most traditional employment training does not really result in jobs that lead to self-sufficiency. Breaking the multigenerational cycle of poverty, lifetime dependence, and homelessness requires education that moves beyond skill-building and into job readiness, incorporating academic skill development into comprehensive programs that address the multiple needs of recipients. (Contains three tables and three figures.) (SLD)