Subsidized employment programs are engines for economic opportunity, stronger labor markets, and healthier communities. Evidence from 50 years of subsidized employment programs shows that subsidized employment is good for workers and employers and can help create a strong, inclusive economy.
Good for Workers & Their Families
Subsidized employment improves the earnings and well-being of workers and their families. Subsidized jobs also help provide individuals with an on-ramp into future, unsubsidized employment. Select evidence:
- Evaluation of New Chance, which operated in 10 states, found positive effects for participating young single mothers on General Educational Development certificate (GED) receipt during the program and college attendance after the program.
- In WorkFirst’s Community Jobs Program in Washington state, evaluators found that 76 percent of participants had found employment within six months after exiting the program.
- Evaluation of the New Hope for Families and Children program in Milwaukee found that participants experienced an increase in employment and earnings while also experiencing improvements in their psychological well-being.
- Evaluation of GoodTransitions in Georgia found that the program created significant increases in participants’ monthly earnings and reduced recidivism rates among participating parents.
Good for Employers
Employer experiences with subsidized employment programs show that they allow employers to grow their businesses and connect to their communities. Participating in subsidized jobs reduces the risks and costs typically associated with hiring and training new workers. Select evidence:
- Evaluation of the Minnesota Emergency Employment Development (MEED) program found that 79 percent of participating small businesses expanded their operations thanks to subsidized employees.
- Through Michigan’s Earn and Learn program, employers faced reduced costs for hiring new workers, enjoyed higher productivity, and had better customer satisfaction and community connection.
- In Connecticut’s Platform to Employment (P2E) program, businesses hired participants on a risk-free basis with P2E funding, and nearly 90 percent of participants transitioned to unsubsidized employment.
- Connecticut’s Step Up program provided subsidies to employers to hire unemployed workers, allowing participating employers to employ 2,590 individuals in 2014.
Good for Society
Communities and local economies benefit from programs that connect workers to jobs, boost economic opportunities, and contribute to cost-effective, positive societal impacts. Select evidence:
- Summer Youth Employment Program participants in Boston reported “[feeling more] connected to their neighborhood,” indicating the program’s positive effects on community connection.
- The Center for Employment Opportunities (CEO) in New York City significantly reduced recidivism and was cost-effective, reducing legal system expenditures, according to program evaluations.
- Participation in Bridges to Pathways in Chicago decreased rates of arrest for felony crimes and violent crimes.
- Evaluations of the $1.6 billion per year Job Corps program—one of the country’s most expensive federally-funded education and training programs—found the program to be a cost-effective investment.
- MEED likely substantially increased net job creation in Minnesota.