The study, which is the first long-term evaluation of the relative effects of alternative training models used under the Workforce Investment Act, found that combining support from training counselors with more flexible individual limits for expenditures on state-approved training would be cost-effective and increase the long-term earnings of jobseekers.
Specifically, U.S. jobseekers could realize potential net benefits of about $41,000 per eligible person over 2 decades, according to the study, which was conducted by Mathematica (www.mathematica-mpr.com) and funded by the U.S. Department of Labor’s Employment and Training Administration.
The study examined three different models for delivering workforce training services through locally provided individual training accounts (ITAs). Those models are Guided Choice, Structured Choice, and Maximum Choice.
Under the Guided Choice model, all jobseekers were limited to an average ITA cap of $3,500—with an average award of $2,861—and were required to participate in counseling to help guide their training decisions. This model, considered the status quo, is similar to the approach currently used by most workforce agencies.
Jobseekers who participated in the Maximum Choice program also had an ITA cap of $3,500—with an average award of $2,888 per person—but no counseling was required after they were determined to be eligible for training.
Meanwhile, under the Structured Choice model, jobseekers had support from training counselors and a more- generous $7,625 spending cap—with an average award of $4,625.
“Compared to the status quo, ITA jobseekers selected training that was better matched to jobs within their chosen occupation under a Structured Choice model, which provided greater training funds with counseling,” Mathematica explained. “The study’s findings demonstrate that this model makes ITA jobseekers more likely to complete training, to earn a credential or degree in the field of training, and to be employed in the occupation in which they trained.”
“Few studies of employment policies have revealed net benefits of such magnitude,” said Irma Perez-Johnson, a senior researcher with Mathematica Policy Research, who directed the study. “The findings demonstrate that increased investment in training, and flexibility in how those funds are applied on an individual level, coupled with availability of counseling support, can have significant positive impacts on long-term employment and earnings.”