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Training: A Targeted Policy Proposal - page 13 / 23





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As far as we are aware, there are no large scale systematic studies of the ES program using a methodology that allow estimation of the causal impact of the program. The only study that uses an appropriate methodology is Jacobson and Petta (2000) who study the effectiveness of the ES program using data from Oregon and Washington. Their results show that ES services lead to a reduction in the duration of employment and that the benefits associated with the reduction exceed the costs of the program (given the very low program costs this finding is not surprising). Interestingly, Jacobson and Petta find that ES services are much more effective for individuals with stronger attachments to the labor market prior to their current spell of unemployment than they are for individuals with spotty work experience prior to their current spell of unemployment.

While there have been a number of studies examining the returns to investing in a fouryear college degree, there have been far fewer examining the returns to a twoyear degree. Most of the studies that look at the effects of community colleges are not particularly relevant for the issue of worker training because they focus on the entire student population instead of those students who recently lost a job, and they focus on the returns to an Associate of Arts degree and not the returns to a diploma or certificate. However, it is the latter two awards that are more relevant for our purposes since these awards require a shorter investment of time and primarily provide vocational training, which is the main focus of job training programs (moreover, many participants in training at a community college will take a course or two but not complete even a certificate program). Papers that are relevant for our purposes are Jacobson, Lalonde and Sullivan (2005a, 2005b), who study the labor market returns to community college for dislocated workers, and Jepsen, Troske and Coomes (2009), who study the labor market returns to receiving a diploma or certificate. Jacobson, Lalonde and Sullivan find that a year of community college raises longrun earnings by approximately 9 percent for men and 13 percent for women. Jepsen, Troske and Coomes find that women receive almost a 40 percent increase in earnings from a diploma while men experience a more modest 18 to 20 percent return (this malefemale differential is often found in the training literature). Both men and women also experience a positive increase in earnings from a certificate. Taken together, these results suggest that attending a community college may provide significant benefits to


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