The Workforce Investment Act: Implementation Experiences and Evaluation Findings

16 - Neither Easy Nor Cheap

447 16 Neither Easy Nor Cheap Sheena McConnell Mathematica Policy Research Peter Schochet Mathematica Policy Research Alberto Martini Universitá del Piemonte Orientale Title I of WIA is the largest source of federally funded employment services in the United States. Its purpose is to increase the employment, job retention, and earnings of its participants. WIA funds the Dislocated Workers, Adult, and Youth programs, as well as Job Corps—a primarily residential training program for disadvantaged youth—and specific programs for Native Americans, migrant and seasonal farm workers, and veterans. In fiscal year 2008, $4.5 billion was spent on WIA programs. The European Social Fund (ESF) provides funding to promote employment in the 27 member states of the European Union (EU). Over the seven years of the current funding cycle (2007–2013), ESF will fund $114 billion in services, accounting for about 10 percent of the total EU budget. ESF has many important similarities to WIA. They are both large and decentralized. WIA allows state and local workforce investment areas to shape their programs. ESF funds are allocated to member states, which funnel the funds to one or more operational programs, which in turn have the ability to fund a wide variety of programs and services at the local level. A similar wide range of services are funded by both WIA and ESF, including counseling, job search assistance, basic education, vocational training, support services, retention services, and entrepreneurial assistance. Services under both WIA and ESF are provided by both government and nongovernment agencies, including small community-based organizations. 448 McConnell, Schochet, and Martini Given the considerable amount spent on employment services in both the United States and Europe, policymakers, participants, taxpayers , and program administrators on both continents want to know which services are effective. For more than three decades, the USDOL has invested heavily in conducting rigorous impact evaluations of its employment programs. In the past decade alone, it has funded experimental evaluations of Job Corps, approaches to administering training vouchers , entrepreneurial services, and prisoner reentry programs. (Benus et al. 2008, McConnell et al. 2006, and Schochet et al. 2008. The experimental evaluation of prisoner reentry programs is being conducted by Social Policy Research Associates and MDRC.) The USDOL has also funded nonexperimental evaluations of the WIA Adult and Dislocated worker programs and the Trade and Adjustment Assistance (TAA) program (Heinrich, Mueser, and Troske 2008). The nonexperimental evaluation of TAA is being conducted by Social Policy Research Associates and Mathematica Policy Research. Recently, the USDOL funded a nationally representative experimental evaluation of the WIA Adult and Dislocated Worker programs that is in its design phase.1 Although the EU does sponsor evaluations of its operational programs, much less emphasis is placed on impact evaluations. And as noted by Greenberg and Shroder (2004), very few experimental evaluations have been conducted on employment programs outside the United States. The purpose of this chapter is to inform EU officials about some of the lessons learned from conducting impact evaluations of employment programs in the United States. It begins by describing the role evaluations have played in decisions about employment policy and programs. It then discusses the three key main steps in any evaluation: 1) choosing the policy-relevant evaluation questions, 2) choosing the best design, and 3) collecting data. The chapter concludes with a summary of our recommendations. EvALUAtION CAN AFFECt POLICY AND PROGRAMMAtIC DECISIONS Information on the effectiveness of employment services is needed for three main reasons. First, because a considerable amount of gov- Neither Easy Nor Cheap 449 ernment funds is invested in employment services, taxpayers need information on the investment’s return. Second, most people in need of employment services are vulnerable and disadvantaged, so it is particularly important that the services offered to them are helpful. Third, a workforce with the skills required by employers is critical for the continued growth of the economy. As discussed below, evidence on service effectiveness has led the U.S. Congress to fund new programs, expand existing programs, and reduce funding for others. Evaluation findings have also been used by program administrators to improve programs. An example of an evaluation that led to a new program is the New Jersey UI Reemployment Demonstration sponsored by the USDOL in the 1980s (Corson et al. 1989). The demonstration involved targeting UI recipients who were likely to have difficulty becoming employed and randomly assigning them to four groups: 1) a treatment group that received job...