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Do Temporary-Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from “Work First”

Do Temporary-Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from “Work... Abstract Temporary-help jobs offer rapid entry into paid employment, but they are typically brief and it is unknown whether they foster longer term employment. We utilize the unique structure of Detroit's welfare-to-work program to identify the effect of temporary-help jobs on labor market advancement. Exploiting the rotational assignment of welfare clients to numerous nonprofit contractors with differing job placement rates, we find that temporary-help job placements do not improve and may diminish subsequent earnings and employment outcomes among participants. In contrast, job placements with direct-hire employers substantially raise earnings and employment over a seven quarter follow-up period. (JEL J22, J23, J24, J31, J68 ) http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png American Economic Journal: Applied Economics American Economic Association

Do Temporary-Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from “Work First”

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Publisher
American Economic Association
Copyright
Copyright © 2010 by the American Economic Association
Subject
Articles
ISSN
1945-7790
eISSN
1945-7790
DOI
10.1257/app.2.3.96
Publisher site
See Article on Publisher Site

Abstract

Abstract Temporary-help jobs offer rapid entry into paid employment, but they are typically brief and it is unknown whether they foster longer term employment. We utilize the unique structure of Detroit's welfare-to-work program to identify the effect of temporary-help jobs on labor market advancement. Exploiting the rotational assignment of welfare clients to numerous nonprofit contractors with differing job placement rates, we find that temporary-help job placements do not improve and may diminish subsequent earnings and employment outcomes among participants. In contrast, job placements with direct-hire employers substantially raise earnings and employment over a seven quarter follow-up period. (JEL J22, J23, J24, J31, J68 )

Journal

American Economic Journal: Applied Economics – American Economic Association

Published: Jul 1, 2010

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