Toward more valid evaluations of training programs serving the disadvantaged

The author challenges the widespread assumption that the wage effects of federal training programs are reliable and unbiased estimates of productivity effects and social benefits. Evidence is presented that the reputations of government training programs are unreliable and that employers stigmatize those eligible for Targeted Jobs Tax Credit and Comprehensive Employment and Training Act on-the-job training contracts. Graduates of classroom training programs which are known to be funded by the Job Training Partnership Act are likely to be similarly stigmatized. TJTC eligibles are seriously underpaid by employers and job training partnership act graduates may experience a similar fate. Consequently, the true effect of JTPA on the productivity of disadvantaged workers may be considerably larger than its effect on wages. The author describes alternative methods of obtaining estimates of productivity effects of training programs.     

Worker Perspectives on the Private Financing of Government-Sponsored Dislocated Worker Programs

This study analyzes worker perspectives on the financing responsibilities of businesses, workers and government for dislocated worker programs that provide job search and retraining assistance to unemployed workers. It is based on a survey of 1,555 experienced workers in Illinois. Joint business and worker financing approaches were the most favored and least polarizing financing alternative. In contrast, the government grant approach was extremely polarizing with significant support but strong negative reaction among higher-income, white, and college-educated workers. Surprisingly strong negative reaction was also found among lower-income, blue-collar workers. The results are consistent with related research on the conservative attitudes of American workers toward social welfare programs.     

THE ROLE OF PUBLIC PROGRAMS AND PRIVATE MARKETS IN REEMPLOYING DISPLACED WORKERS

This paper is about the reemployment difficulties of "mainstream" workers dislocated in mid-career by structural economic change. Contrary to popular assumptions, empirical evidence suggests that most workers in this category do not encounter extraordinary reemployment difficulties.
For those that do, the root problem is not dislocation per se but rather such well-known failures of the private labor market as geographic immobility, underinvestment in training, and inefficient labor exchange institutions. Public policy should be structured in terms of correcting these market failures, not in terms of dislocated workers as atarget group.     

IMPLEMENTING PRIVATE SECTOR STRATEGIES IN EMPLOYMENT AND TRAINING PROGRAMS

This paper examines efforts to increase the role of the private sector in employment and job training programs mandated by the Private Sector Initiative Program (PSIP) and the Job Training Partnership Act (JTPA). In particular it will examine whether the emphasis on the private sector participation has led to a greater development of and reliance upon private sector strategies for training and placing the unemployed, as well as an exploration o f the relationship between public and private sector officials involved in program implementation.     

Market forces and private sector processes in government policy: The job training partnership act

This article examines those provisions of the Job Training Partnership Act designed to introduce the presumed efficiency of marketlike forces and incentives into federal employment and training programs. First, the JTPA replaced the administrative system used in earlier training programs (which emphasized detailed federal control and monitoring of the programs at the local level) with a system that, in effect, set a price for a prescribed level of performance and reduced oversight of the training process. Second, the Act gave people in private business some control over programs at the local level. According to available data, JTPA program performance is no different in local areas with a strong private-sector involvement than in areas where that involvement is weak and passive. The performance standards have had an effect, although the relationship between the standards and the goals of the JTPA is ambiguous at best. The article outlines the limitations of a market-oriented system for the administration of public policy.     

Are Reemployment Services Effective? Experimental Evidence from the Great Recession

We examine an experimental‐design reemployment program implemented in Nevada during the Great Recession that required Unemployment Insurance (UI) recipients to: (1) undergo an eligibility review to confirm they were qualified for benefits and actively searching for work and, if deemed eligible, (2) receive job‐counseling services. Our results show that the program expedited participant exit from UI, produced UI savings that exceeded program costs, and improved participant employment outcomes. Analyses of program effects on the UI exit likelihood show that the program's effects are partly associated with increased participant exit up through the time when program activities were scheduled, reflecting voluntary exit of participants from UI to avoid program activities and disqualifications of participants who failed to meet eligibility requirements. In addition, the program induced substantial participant exit from UI in the period after participants fulfilled requirements and their interactions with the program had ended, suggesting that the job‐counseling services offered by the program may have helped participants to conduct more effective job searches. Our findings provide evidence that reemployment programs that combine an eligibility review with mandatory participation in job‐search services can be effective during recessions.     

Thirty Years of Changing Federal, State, and Local Relationships in Employment and Training Programs

There have been three major training programs in the UnitedStates in the past thirty years: the Manpower Development andTraining Act (MDTA)from 1962 to 1973, the Comprehensive Employmentand Training Act (CETA)from 1973 to 1982, and the Job TrainingPartnership Act (JTPA)from 1982 to the present. MDTA was a categoricalprogram, with service providers funded directly by the federalgovernment. CETA was a hybrid block grant program that gavelocal units of government substantial autonomy in administeringthe basic training component, but CETA also includedcategoricalprogramsfor specific target groups and for public service employment.Over time, CETA was increasingly regulated. JTPA is regulatedmore by the states and the private sector, and in 1992 amendmentstargeted the program more sharply and restricted activitiesthat could be undertaken. Federalism in employment and trainingprograms has followed a course similar to other areas, withcooperative federalism ending in 1978 being replaced by coercivefederalism. In recent years, stales have started a number ofinnovative programs.     

ECONOMIC MOTIVES FOR "SOCIAL" PROGRAMS: THE NEW FEDERAL DIRECTION

The Job Training Partnership Act (JTPA), passed by Congress in 1982, is significant federal employment and training legislation for a number of reasons. Most noticeably, it substantially enhanced private sector and state government roles in the administration of such programs. In order to understand both the programmatic impact of JTPA and its likely consequences on subsequent federal employment and training initiatives, it is necessary to look at the politics of the legislation-especially those interests that are strongly represented through its implementation and those that are not. By doing this, one obtains a better sense of the dimensions of conflict around future employment and training legislation. General guidelines within which Congress should act in subsequent legislative activity are laid out.     

Getting a Job is Only Half the Battle: Maternal Job Loss and Child Classroom Behavior in Low-Income Families

This study uses data from an experimental employment program and instrumental variables (IV) estimation to examine the effects of maternal job loss on child classroom behavior. Random assignment to the treatment at one of three program sites is an exogenous predictor of employment patterns. Cross-site variation in treatment-control differences is used to identify the effects of employment levels and transitions. Under certain assumptions, this method controls for unobserved correlates of job loss and child well-being, as well as measurement error and simultaneity. IV estimates suggest that maternal job loss sharply increases problem behavior but has neutral effects on positive social behavior. Current employment programs concentrate primarily on job entry, but these findings point to the importance of promoting job stability for workers and their children.     

Labor market experiences of low-income black women in middle-class suburbs: Evidence from a survey of gautreaux program participants

This article reports on a highly unusual experiment in racial and economic integration, the Gautreaux program. This program helps black families who are either current or former residents of public housing move into subsidized housing in Chicago and its suburbs. Surveying a random sample of 332 participants, we find that suburban movers are significantly more likely to have a job post-move than city movers, even among those who had never had a job before moving. Multivariate analysis shows that these differences are significant even after controlling for respondents' previous work history, human capital, and personal characteristics. These results suggest that low-income urban blacks experience significant gains in employment by moving to middle-class suburbs. Thus, housing assistance may be an effective alternative to traditional welfare-to-work programs.     

THE PRIVATE SECTOR IN PUBLIC EMPLOYMENT AND TRAINING PROGRAMS

Assimilating disadvantaged workers in labor markets has been the focus of national policy initiatives for at least two decades. In recent years, public policies have been formulated which will not only provide incentives for the private sector to employ the disadvantaged, but also afford the private sector a larger responsibility in formulating and implementing targeted employment programs. The Job Training Partnership Act (JTPA) and Target Jobs Tax Credit (TJTC) are two major examples. This paper initially reviews the public and private employment and training efforts between 1962 and 1982. Considerable attention is given to summarizing and evaluating the performance of these efforts, especially in light of recent program initiatives by the Reagan Administration.     

Child characteristics and successful use of housing vouchers: Estimates from the moving to opportunity demonstration

Abstract

Voucher‐based programs have become the most common form of housing assistance for low‐income families in the United States, yet only a slim majority of households that are offered vouchers actually move with them. This article uses data from 2,938 households in the Moving to Opportunity demonstration program to examine whether child characteristics influence the probability that a household will successfully use a housing voucher to lease‐up.

Our results suggest that while many child characteristics have little bearing on the use of housing vouchers, child health, behavioral, and educational problems, particularly the presence of multiple problems in a household, do have an influence. Households with two or more child problems are 7 percentage points less likely to move than those who have none of these problems or only one. Results suggest that such families may need additional support to benefit from housing vouchers or alternative types of affordable housing units.     

HELPING PEOPLE WITH LABOR MARKET PROBLEMS: AN OVERVIEW OF KEY POLICIES

Those in need of employment and training programs face a variety of difficulties. Accordingly, the federal response to labor market problems has encompassed a wide range of initiatives. These include preparing people for work (through skills training, the Job Corps, work experience programs); improving the functioning of the labor market (through matching workers with jobs, establishing a minimum wage, and the Targeted Jobs Tax Credit program); and preventing discrimination. Unresolved issues in these areas are examined. They include who should be targeted for federal assistance, which levels of government can best operate programs, how public versus private efforts should be balanced, how limited resources should be distributed, and how the welfare versus work question should be resolved.     

Scenes from a mall: Retail training and the social exclusion of low-skilled workers

In this article we examine how post-industrial Britain and Denmark undertake vocational training for low-skilled retail workers. Specifically, we evaluate whether leaders in training skilled industrial workers are also doing the best job with low-skilled service workers. While Danish retail is increasingly becoming a haven for low-skilled workers, British workers are gaining in skills levels with the transition to services even in the retail sector. While some suggest that social democratic countries have sacrificed the political interests of low-skilled workers in order to protect core manufacturing workers, we find no evidence of this. Rather, the high expectations of vocational training in Denmark have forged barriers to the easy admission of low-skilled service workers, while the British system provides more entry points for vocational training at different levels. The structures of coordination that had narrowed the gap between white-collar and blue-collar manufacturing workers during the industrial age are creating new cleavages in the post-industrial economy.     

Physically demanding occupations, health, and work after retirement: findings from the New Beneficiary Survey

This article uses data on a recent cohort of Social Security retired-worker beneficiaries to examine the predictors of work after initial receipt of benefits. It focuses on two factors: an analysis of the effects of ill health and of employment in a physically demanding occupation in the year preceding receipt of benefits. Based on responses received during the Social Security Administration's New Beneficiary Survey, the employment of men in a physically demanding occupation is associated with a lower probability of work in retirement; the existence of a work-limiting health condition also lowers their probability of work. Full-time, full-year workers in 1979 who had changed jobs in the years just preceding the receipt of Social Security benefits were more likely to work after they became beneficiaries. It may be that workers anticipate constraints on their ability to continue working on a job and reduce the effect of those constraints through earlier job changes. The finding that the work effort of women beneficiaries is not affected by previous employment in occupations identified as physically demanding may signify the failure of customary physical demand indices to measure stress on those jobs in which women are most likely to be employed.     

Black-white differences in private pensions: findings from the retirement history study.

This article compares older black workers and older white workers on coverage under private pension plans, the receipt of pension benefits upon retirement, and the job characteristics associated with both coverage and receipt. Data are from the 1969 and 1975 interviews of the Retirement History Study and describe pre-ERISA conditions among persons in their late fifties to mid-sixties. Black workers were much less likely than white workers to have been covered by a private pension on their longest job. Moreover, among those who were covered, they were less likely to have received benefits. The racial differences appear to result in part from subtantial differences on job characteristics, particularly industry.     

Pathways to work for low‐income workers: The effect of work in the temporary help industry

This paper provides new evidence to inform the policy debate about the effect of a newly important industry—the temporary help industry—on the labor market outcomes of low‐income workers and those workers who are at risk of being on public assistance. The core issue of whether temporary help work harms the long‐term prospects of disadvantaged individuals depends critically on the alternatives available to the worker. Temporary employment results in labor market outcomes that are better than not working at all. For example, while nonemployed public assistance recipients have only a 35 percent chance of being employed a year later, those who were in temporary employment have almost twice the likelihood of being employed in the same period. These findings, if correct, would support the use of temporary agencies by welfare programs. © 2003 by the Association for Public Policy Analysis and Management     

Testing a Financial Incentive to Promote Re‐employment among Displaced Workers: The Canadian Earnings Supplement Project (ESP)

This article presents findings from a randomized experiment conducted in four Canadian provinces to measure the effects of a generous financial incentive that was designed to promote rapid re‐employment among workers who were displaced from their jobs by changing economic conditions. The incentive tested was an earnings supplement which, for as long as 2 years and as much as $250 weekly, would replace 75 percent of the earnings loss incurred by displaced workers who took a new lower‐paying full‐time job within six months of receiving a supplement offer. Findings from the experiment indicate that although persons offered the supplement understood its terms and conditions, only 2 out of 10 actually received supplement payments. Furthermore, the supplement offer had little effect on job‐search behavior, employment prospects, or receipt of unemployment insurance. Nevertheless, persons who received supplement payments benefited from them substantially. On average, they received payments for 64 weeks, totaling $8,705. © 2001 by the Association for Public Policy Analysis and Management.     

Chronic Illness and health insurance-related job lock.

Job duration patterns are examined for evidence of health insurance-related job lock among chronically ill workers or workers whose family member is chronically ill. Using Cox proportional hazard models to indicate the effect of health insurance and health status on workers' job duration we allow for more general insurance effects than that shown in the existing literature. Data for workers in Indiana predating the Health Insurance Portability and Accountability Act (HIPAA) are used to examine the potential effect of HIPAA on job mobility. Among the workers in this sample who relied on their employer for coverage, chronic illness reduced job mobility by about 40 percent as compared with otherwise similar workers who did not rely on their employer for coverage. Results reported here identify previously under-appreciated job lock among chronically ill workers and workers whose family member is chronically ill, clarify how one best researches job lock, and indicate the potential effect of policies aimed at alleviating job lock and promoting inter-employer worker mobility.     

Housing Voucher Take‐Up and Labor Market Impacts

Low participation rates in government assistance programs are a major policy concern in the United States. This paper studies take‐up of Section 8 housing vouchers, a program in which take‐up rates are quite low among interested and eligible households. We link 18,109 households in Chicago that were offered vouchers through a lottery to administrative data and study how baseline employment, earnings, public assistance, arrests, residential location, and children's academic performance predict take‐up. Our analysis finds mixed evidence of whether the most disadvantaged or distressed households face the largest barriers to program participation. We also study the causal impact of peer behavior on take‐up by exploiting idiosyncratic variation in the timing of voucher offers. We find that the probability of lease‐up increases with the number of neighbors who recently received voucher offers. Finally, we explore the policy implications of increasing housing voucher take‐up by applying reweighting methods to existing causal impact estimates of voucher receipt. This analysis suggests that greater utilization of vouchers may lead to larger reductions in labor market activity. Differences in take‐up rates across settings may be important to consider when assessing the external validity of studies identifying the effects of public assistance programs.