This resource examines the effect of three different packages of job search assistance services on the employment outcomes and length of benefit receipt of Unemployment Insurance recipients in the District of Columbia and Florida in order to determine whether such interventions reduced recipients’ time on UI and were cost-effective.
The Emergency Unemployment Compensation Act of 1991 authorized the U.S. Department of Labor (DOL) to conduct the Job Search Assistance (JSA) demonstration to test the feasibility of implementing job search assistance programs and measure their effectiveness in promoting rapid re-employment and reduced UI spells among Unemployment Insurance (UI) claimants. The demonstration was designed to identify UI claimants who were likely to face lengthy UI spells and to provide them with assistance in finding a new job. Three different assistance strategies were tested in the demonstration. In each case, assistance was provided in the demonstration by the local Job Service (JS) agencies, while the UI agencies monitored participation in the demonstration and sanctioned claimants who failed to comply with the demonstration’s participation requirements.
The demonstration was conducted in the District of Columbia (D.C.) and Florida. The D.C. demonstration served a targeted sample of claimants from the full D.C. claimant population. Claimant selection occurred between June 1995 and June 1996, and a total of 8,071 claimants were assigned to the demonstration. The Florida demonstration operated in 10 local Jobs and Benefits offices scattered throughout the state. Each local office served a targeted sample of claimants from the local UI claimant population. Claimant selection occurred between March 1995 and March 1996, and a total of 12,042 claimants were assigned to the demonstration.
This report examines the participation of claimants in the Florida and D.C. demonstration projects and the impact of the demonstrations on claimant outcomes over approximately two years following each claimant’s initial UI claim. It uses a random assignment design to compare the impacts of three types of job search assistance interventions: structured job search assistance, individualized job search assistance, and individualized job search assistance with training. The authors estimated impacts of each of the demonstration treatments on various measures of UI receipt, benefit nonmonetary determinations and denials, employment and earnings, job characteristics, and job search activities. The treatments were expected to increase search effort, speed re-employment, and reduce UI benefits.
Major Findings & Recommendations
Impacts on UI Receipt and Eligibility
Each of the JSA treatments reduced UI receipt in the initial benefit year. The largest impact occurred in the Structured Job Search Assistance (SJSA) group in D.C., where UI receipt was reduced by more than a week. The other treatments in D.C. and all three treatments in Florida had more modest impacts, reducing UI receipt by about half a week. These findings do not allow the authors to draw a definitive conclusion about which service strategy is most effective in reducing UI spells.
Impacts on Employment and Earnings
The JSA treatments had somewhat uneven impacts on employment and earnings following the initial UI claim. On the one hand, the SJSA group in D.C. generally had higher earnings than the control group. Moreover, the impacts of SJSA on quarterly earnings in D.C. were fairly large, about $200 per quarter. On the other hand, the estimated impacts of SJSA on quarterly earnings in Florida and the estimated impacts of Individualized Job Search Assistance (IJSA) and Individualized Job Search Assistance Plus Training (IJSA+) on quarterly earnings in both states tended to be smaller. However, both IJSA and IJSA+ significantly increased quarterly earnings in D.C. The impacts on employment rates were similar to the impacts on earnings.
Impacts on Job Search
The JSA demonstration encouraged more aggressive job search efforts among treatment group members. In both D.C. and Florida, each of the JSA treatments led claimants to contact more employers per week in their job search.
Cost-Effectiveness of the JSA Treatments
The authors' estimates imply that the JSA treatments were not cost-effective from the perspective of DOL. None of the treatments generated a positive return on the resources invested by DOL—the estimated reductions in UI payments caused by the treatments were not large enough to fully compensate for the costs of the services.