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The welfare reforms of the 1990s dramatically increased the
need for effective strategies to help low-income parents work
more steadily and advance in the labor market; long-term reliance
on public assistance is no longer an option for most families.
Yet, while a great deal is known about how to help welfare
recipients prepare for and find jobs, there is little hard
evidence about what works to promote employment retention
and advancement.
The Employment Retention and Advancement
(ERA) evaluation is the most comprehensive attempt thus far
to understand which program models are most effective in promoting
stable employment and career progression for welfare recipients
and other low-income workers. Conceived and sponsored by the
Administration for Children and Families (ACF) in the U.S.
Department of Health and Human Services (HHS), the ERA project
includes up to 15 random assignment experiments across the
country. The evaluation is being conducted under contract
to ACF by the Manpower Demonstration Research Corporation
(MDRC), a nonprofit, nonpartisan organization. MDRC, with
assistance from the Lewin Group, is also providing technical
assistance to help make the ERA programs as strong as possible.
This first report on the ERA evaluation,
which began in late 1999, describes the emerging ERA programs
and identifies some early lessons on the design and implementation
of relatively large-scale retention and advancement programs.
I. The ERA Programs
As of fall 2001, a total of 15 ERA demonstration
projects were operating or under development in nine states.[1]
The projects are diverse and represent a range of goals, service
strategies, target populations, and organizational structures.
As shown in Table
ES.1, the ERA projects can be divided into three broad
groups according to their primary emphasis:
- Advancement projects. Six of the projects focus
primarily on helping low-wage workers move up to better
jobs. Services include career counseling, targeted job search
assistance, close linkages with employers to identify or
build career ladders, and education and training to help
participants upgrade their skills while working.
- Placement and retention projects. Four projects
focus mostly on helping participants find and hold jobs.
These projects target various “hard-to-employ”
groups — for example, welfare recipients who have disabilities
or substance abuse problems — for whom advancement
is considered a longer-term objective.
- Projects with mixed goals. The remaining projects
focus on both retention and advancement, and most of them
start working with welfare recipients who are searching
for jobs. These projects focus first on job placement, next
on retention, and finally on advancement.
Most of the ERA projects are operating in
urban areas (including sites in the nation’s four largest
cities), and most are relative large in scale, enrolling 1,000
to 2,000 people over a one- to two-year period. The programs
were typically developed to help families for whom recent
welfare reform efforts have been less successful — for
example, welfare leavers working unsteadily or in low-wage
jobs or recipients who have been unable to find work. As a
result, almost all the programs target current or former recipients
of Temporary Assistance for Needy Families (TANF) cash welfare.
(In many states, the TANF rules allow recipients who obtain
low-wage or part-time jobs to continue receiving a partial
grant to supplement their earnings.)
A number of the ERA projects are operated
directly by state or local welfare agencies; others are operated
by nonprofit organizations or colleges under contract to welfare
agencies; and still others represent collaborations among
welfare and workforce development agencies.
II. Program Design Strategies
In designing ERA projects, state planners
sought to learn from earlier retention and advancement efforts,
notably, the Post-Employment Services Demonstration (PESD),
a four-site project that tested programs providing follow-up
case management to welfare recipients who found jobs. A careful
evaluation found that the programs generally failed to improve
employment retention.
Whereas the PESD programs used the same
basic service — case management — to promote employment
retention for a diverse set of clients, the ERA projects are
seeking to better synchronize their goals, target groups,
and service strategies. For example, PESD found that many
welfare recipients who found jobs were able to retain them
without special help. Thus, most of the ERA projects that
target employed people focus more directly on career advancement.
The ERA projects that emphasize employment retention target
narrower, “hard-to-employ” groups whose members
have demonstrated that they have difficulty finding or holding
jobs.
Similarly, while most of the ERA programs
are built around case management, they have sought to refine
their approaches based on the lessons of PESD. For example,
rather than waiting until people have found jobs, many ERA
projects begin working with participants while they are searching
for work, aiming to establish relationships that can carry
over into the post-employment phase. In addition, these projects
seek to improve the quality of the initial job placement:
Although they have maintained a “work first” focus,
they use career planning and other strategies to promote better
job matches.
Finally, in most of the ERA projects, case
management is seen not as the main service strategy but, rather,
as the means of delivering other services or activities designed
to meet the program’s goals — for example, education
or training, financial incentives, career planning, rehabilitation
services, or job search assistance.
III. Early Lessons on
Operating ERA Programs
As the largest current project dedicated
to building knowledge about retention and advancement strategies,
ERA provides a rich learning laboratory. Although many of
the programs have begun operating only recently, important
lessons are already emerging:
- Encouraging participation in retention and advancement
services is an ongoing challenge.
Low-income, single, working parents —
the primary target population for the ERA programs —
face daunting daily challenges juggling work and parenting.
It should not come as a surprise that many such parents are
reticent about participating in retention and advancement
activities — even when such services are nominally mandatory
for parents still receiving welfare.
Sites have addressed this challenge by designing
aggressive marketing strategies, by offering services at convenient
locations or at nonstandard hours, and, in a few cases, by
offering financial incentives to encourage participation.
In designing services and marketing strategies, several of
the projects drew on surveys or focus groups to learn about
the target population.
- Agencies that operate retention and advancement programs
often have to restructure staff roles, train staff to take
on new responsibilities, and lower caseloads.
Staff in ERA programs need to have specialized
skills and knowledge. For example, they should understand
how to “sell” services to working parents, how to
work directly with employers to address retention issues and
identify career ladders within firms or industries, and how
to help participants identify and access flexible training
or education programs in their communities.
Most staff in traditional welfare-to-work
programs do not possess this diverse range of skills. Thus,
ERA sites — with assistance from MDRC — have devoted
considerable resources to staff development and training.
Some programs have created case management teams that draw
on staff who have specialized expertise. To facilitate more
intensive services, several of the programs have reduced the
number of participants assigned to each worker.
- Interagency partnerships are vital to delivering retention
and advancement services, but it can be difficult to develop
and maintain such linkages.
Most of the ERA projects represent collaborations
among welfare and workforce agencies, community colleges,
nonprofit providers, and others. In many sites, these linkages
already existed to deliver employment services to welfare
recipients, but, in a few sites, new partnerships were forged
specifically for ERA. Although it is often difficult to develop
and maintain such partnerships, they offer a range of benefits
to participants by giving them access to the specialized expertise
of multiple agencies (and, in some cases, additional funding
for services). The choice of service providers was particularly
critical in the projects serving hard-to-employ groups, because
these clients often require specialized treatment or rehabilitation
services.
One of the most ambitious strategies — likely to be pursued in a few
sites — is to build linkages directly with targeted employers.
The hope is that these linkages will go beyond the traditional
emphasis on job placement to focus on identifying career ladders
and helping ERA participants access them. The sites are crafting
strategies that benefit both employers and participants.
- It may be critical to develop advancement strategies
that go beyond traditional classroom-based education and
training.
For reasons discussed earlier, many programs
have found it difficult to recruit low-income working parents
into education or training programs. A few of the ERA projects
are tackling this issue head-on, designing new recruitment
strategies and working with education agencies to develop
working-parent-friendly classes. Others are trying to craft
advancement strategies that do not rely as heavily on traditional
education and training — including career counseling,
targeted job search help, and in-depth work with employers
to identify (or even create) career ladders. Such approaches
are used across the country, but they are rarely implemented
on a large scale.
IV. What Is Coming Up?
Each of the ERA projects is being evaluated
using a random assignment design in which eligible clients
are assigned, by chance, to a program group that is eligible
for ERA services or to a control group that receives the services
that were available before the ERA project was developed.
MDRC will use surveys and administrative records to follow
both groups for up to three years. Because individuals are
assigned to the two groups at random, there are no systematic
differences between the groups’ members when people enter
the study. Thus, any differences that emerge during the follow-up
period are attributable to the ERA program being tested.
This design will allow ACF and MDRC to obtain
reliable data about whether the programs increase employment
rates, employment stability, wage progression, family income,
and other important outcomes. The study will also assess whether
results differ for important subgroups of the target population
— for example, people with or without a high school diploma
— and will compare the financial costs and benefits of
the programs.
MDRC will produce a separate interim report
describing the implementation and early effects of each ERA
project. Crosscutting reports will draw lessons from across
the many tests.
V. Policy Implications
Although still at an early stage, the ERA
project has already demonstrated that states and localities
can mount innovative, large-scale programs to promote employment
retention and advancement for welfare recipients and other
low-wage workers. The states’ strong commitment to the
ERA projects — even in the face of mounting budget pressures
— suggests that their vision for welfare reform includes
a focus on long-term self-sufficiency for families. These
investments are particularly critical as time limits on the
receipt of cash benefits expire and the economy weakens. In
this environment, the importance of employment stability and
wage progression is magnified.
The tremendous flexibility inherent in the
block grant structure that was created in the 1996 federal
welfare law has facilitated this evolution in welfare reform.
As welfare caseloads declined, many states have been able
to shift resources from providing basic assistance to building
a new set of supports for low-income working families. The
states’ ability to sustain and expand these efforts will
likely depend on whether the funding level and the flexible
approach are maintained — and even enhanced — when
the TANF block grant is reauthorized in 2002.
Notes:
[1]The
nine states having demonstration projects discussed in this
report are: California, Florida, Illinois, Minnesota, New
York, Oregon, South Carolina, Tennessee, and Texas. Florida’s
ongoing participation in the project is uncertain because
necessary programmatic funding had not been secured when
this report was completed. In addition, Ohio joined the
project in late 2001 with an employer-focused project that
will operate in Cleveland. The planned Florida program is
discussed in this report, but the Ohio program is not.
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