Government Spending

Job Training Won't Solve Our Employment Problems

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Disheartening news from the New York Times on the efficacy of government funded "job retraining," that great hope for an economy in transition:

…for all the popularity of these government-financed programs, there are questions about whether they actually work, even as President Obama's stimulus plan directs $1.4 billion more to retraining and other services for people who have lost their jobs….

….a little-noticed study the Labor Department released several months ago found that the benefits of the biggest federal job training program were "small or nonexistent" for laid-off workers. It showed little difference in earnings and the chances of being rehired between laid-off people who had been retrained and those who had not.

In interviews, the authors of the study and other economists cited several reasons that retraining might not be effective. Many workers who have lost their jobs are older and had spent their lives working in one industry. In need of a job right away, many pick relatively short training programs, which often have marginal benefits. Job retraining is also ineffective without job creation, a point made by several economists who have long cautioned against placing too much stock in it. Finally, workers trying to pick a new field cannot predict the future of the labor market, especially in a time of economic upheaval.

"I can't tell you with any degree of certainty, and I've been doing it for 20 years, what the hot jobs are going to be," said one of the authors, Kenneth R. Troske, an economics professor at the University of Kentucky.

The rest of the story has various mostly depressing specific stories of job retraining failures from Michigan.

Nick Gillespie from 2006 on who government job training programs do help–those who administer them.

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  1. Job training is one of those things that looks good on paper and for leftists that is usually the only test they apply. It just seems so reasonable to people with little real-world experience that job training would be a quick and effective solution to unemployment. They never actually test to see if the programs work in the real world.

    Of course, once politicians and their various hangers-on invest their reputations in such programs, questioning the programs becomes verboten.

  2. “Problem is Hard, Libertarians Are Stumped, Declare Situation Hopeless, Blame Government. Film at 11.”

    Same as ever. You guys couldn’t find a free market-based solution for exiting a wet paper bag.

    Clue: Lots of young people who go through the 4 year job training program known as “college” have trouble getting jobs in their desired field, too. Now consider people 20-30 years older and it should come as no surprise to hard-nosed, coldly analytical market-based libertarians that they aren’t going to be avidly sought no matter what training they get.

    Yet, someone whose industry has died is unlikely to find work with the skills they have, so getting them a job is going to require some kind of training. And that’s going to have to be paid for, one way or another.

    So what’s your suggestion, geniuses?

  3. With Jobs goin’ off-shore, what are people goin’ 2 get trained on ?

  4. ” Finally, workers trying to pick a new field cannot predict the future of the labor market, especially in a time of economic upheaval.”

    A problem universal to 19 year olds.

  5. “So what’s your suggestion, geniuses?”

    Get a student loan, go back to college, and major in something other than Sociology or Bulgarian Lesbian Studies

  6. MIke wrote: “Get a student loan, go back to college, and major in something other than Sociology or Bulgarian Lesbian Studies”

    So job retraining, in other words, and we’re back where we started.

    Though you might want to consider the economics of a 40 or 50 year old getting a 4 year degree.

    And it’s not like a 45 year old with a recent Bachelor’s degree, looking for an entry-level job would be an attractive hire compared to the 21 year old competition. And the 21 year olds might have trouble finding work, too.

  7. Nobody said it would be easy. There are no easy solutions to difficult problems. Anybody who claims otherwise is trying to sell you something. Suck it up.

  8. Jon’s mighty (if ultimately aimless) compassion overwhelms our cold hearted reason.

    Newsflash for Jon – bad shit happens: not the fault of the individual, the govt, big business or god. Only children expect mommy and daddy to make the world a safe.

  9. Jon H:

    1. Job retraining paid for by whom??

    By the potential employee who has an important incentive to learn a new skill, who knows what he might like to do and who bears the burden of failure, thus propelling him to study hard?

    or by taking money from other people collectively, with no personal risk and no particular incentive to work hard for personal reward?

    Which, of course also means, more than likely that the tax-funded job retraining is coming in part from the wages of the struggling kids recently out of college (like me, for example), who did go to school for a purpose.

    2. What “me” said. Life is damn hard enough as it is, and considering we’re in the midst of a government-created problem (yes), maybe we shouldn’t be looking to government solutions. Especially when we’re some $80 trillion in debt (including our unfunded liabilities)

  10. God, isn’t it amazing how everything supports the libertarian position? Is a theory with no counter evidence whatsoever even a theory? I mean, why can’t everybody just accept the libertarian truth? It’s so obvious. Nothing government does ever works. Ever. Gosh, I don’t get it.

  11. The unceasing advocacy of retraining assumes that the reason people lose jobs or just don’t get hired for new jobs is that there are more jobs that require new/elevated skills than there are qualified people for them. But when it’s simply a matter of unavoidable systematic contraction (like the current slow-motion collapse), then most people are fucked regardless of training.

  12. Sean, I prefer “Especially when we’re looking at $80 trillion in unfunded liabilities” or simply “Especially when we’re going to have to come up with at least $500 billion/year in interest payments and at least $2 trillion/year in entitlements, and both of those numbers are going way up.”

  13. Jon H:So what’s your suggestion, geniuses?

    First of all, who said there was a hard and fast rule that libertarians oppose retraining? You need to stop assuming things. For those with the initiative, I would read business magazines, want ads, etc, and see what jobs are in demand. One area that comes to mind is nursing, and jobs like dental assistants. And then get student loans, and find training in those fields. I think individuals determining what field they want to go into is better than a government agency overseeing “jobs retraining” – at most, the government should provide loans and grants to individuals to spend on the retraining of their choice. And second, in every recession, jobs get destroyed, and it takes time for new industries to ramp up, with new jobs. There used to be phone operators to connect calls.. gas stations used to be almost all full service. There used to be a lot more bank tellers.. but automation happens, recessions happen, jobs get destroyed that don’t come back – it’s always happened before, and this time it’s no different. In those cases, it’s true – no amount of retraining will help. It’s just a waiting game until the free market creates new jobs. And what we don’t want is impediments to the free market that will create these new businesses and jobs..

  14. Karl:

    I, like many of my compatriots around here I would imagine, became a libertarian through studying history and economics and simultaneously trying to deal with philosophical issues…

    For me, the conclusions came long before I learned of the “libertarian” label. All you really need to understand is this:

    Do people own themselves? Yes or No?

    Your answer determines a lot in the sphere of government: If you say no, then using force to compel people to do whatever you want, i.e. to pay for whatever you’d like them to is perfectly fine. Their time isn’t “theirs”, but someone else’s to control.

    If you say yes, people are in fact self-owners, then they have the right to use their time and energies as they see fit free from coercion from anyone else… Your life is yours, your thoughts are yours, your actions are up to you and thus the products of your effort (your money/property) are yours as well. Taking from you without asking, without your consent, and upon threat of physical violence (for example… getting thrown in jail), is therefore immoral.

    I answer “Yes”. You probably do too.

    The difference here is that while you might make a distinction between a random mugger on the street taking your money against your will and a government taking it – I don’t. A single thief has no more right to your property than hundreds or thousands of thieves. Likewise, just as a single person has no right to harm or kill you, or to force you to act according to their values, or enslave you – neither does a large group of people. It doesn’t matter what their title is or who “elected” them, theft is theft & slavery is slavery.

    On the flip side of all that, these moral principles is the economic reality of freedom being a much better road to prosperity than planning.

    The moral principle isn’t really “falsifiable” in essence – but it comes down to whether or not you believe that your life is yours or whether it belongs to “society”, “government”, or anyone else. Ultimately, what this means is – you can intervene when someone’s being attacked, you can defend people’s lives, liberties, property – but you don’t get to attack them, or steal from them, or use government to do that. The economics is falsifiable, but as yet, really hasn’t been… I don’t find that to be coincidental. Logic & observation applied to philosophy did me pretty well, and logic applied to economics has meant that our boys did a great job predicting and understanding current events when most everyone else failed miserably.

    A quote I’ve been using a lot lately:
    “Libertarianism is the radical notion that you don’t own other people.”

    It’s pretty much that simple.

  15. Karl – if you have better ideas, why don’t you post them? Or are you the type that just sits back and criticize everyone, but lack any real ideas yourself?

  16. of course job training doesnt work. We have too many people living in america. This is not a rant against illegal immigrants. I’m not spewing a good ol’ south park “They took our jeeeeeeeeeeeeeeobs!” – we took our jobs, and there were still too many of us left over.

    It’s not a problem with untrained workers – all the jobs requiring job training are all filled up. Or shipped off overseas.

    There are three ways to cut down on American jobless numbers. 1. Have less Americans. 2. Cut our pay/benefits (i.e. get paid as much as a worker in India… all else equal it’s cheaper to keep jobs in America for 4 cents an hour than to ship them overseas for 4 cents an hour). 3. Create new industries that require lots of new jobs. The teleportation industry. The fusion industry. The legalized drug industry. But those are sci-fi and they’ll never happen, assuming they ever could. So that’s really not an option. The “smaller cellphone with a higher megapixel camera” industry is not going to create any jobs.

  17. Mike | July 7, 2009, 11:23pm | #
    “So what’s your suggestion, geniuses?”

    Get a student loan, go back to college, and major in something other than Sociology or Bulgarian Lesbian Studies

    ————-

    I’m all for Bulgarian Lesbian Studies if they’re hot.

    Isn’t everybody?

  18. Job retraining only works if there are jobs waiting for people after retraining. Otherwise, you have freshly trained people who are unexperienced in their new field looking for jobs, rather than people with experience in their fields looking for jobs.

    If there aren’t jobs waiting when they complete training, then these folks have just completed government sponsored mental masterbation on our dime.

    Frankly, I say let the people pay for their retraining. Then, they can at least study something they are actually interested in and are free to work in that field if they so choose…and we’re not stuck with the bill!

  19. Yet, someone whose industry has died is unlikely to find work with the skills they have, so getting them a job is going to require some kind of training. And that’s going to have to be paid for, one way or another.

    So what’s your suggestion, geniuses?

    I suggest that you, Jon H, immediately file papers to create a non-profit company with the mission to pay for this training. It should be easy to round up a few hundred bleeding-hearts willing to donate to such a worthy cause, no?

    The beauty of this solution is that you get to make a real change with a worthy cause (instead of simply complaining that government isn’t doing enough), while maintaining your snotty attitude towards libertarians. Everyone wins!

  20. People who support government programs such as these are making the old Broken Window Fallacy.
    http://mises.org/story/2868

  21. Has anybody considered any of the successful 2-year community colleges? Many of these are excellent career oriented schools. I’ll direct your attention to Camden County College, NJ. Most of them are at least partially funded by state and county governments. And a few years back, the state of NJ instituted a “retraining” program for people collecting unemployment compensation. Benefits are extended and classes are free. The catch is that you have to wait until after all paying students register. In other words, fill the empty seats. On top of that, there are federal Pell grants and GSL student loans. Too much government? Maybe. But most of the money that comes from the county (recently)is from a policy instituted about 10 years ago that imposes a “user fee” at the county jail ($5/day, min. $35).
    See pages 51-98 for career programs [.pdf]

    I would argue that this is an extremely successful school and has provided an invaluable service to the residents of Camden and surrounding counties.

    Instead of the federal government funding their own retraining programs, perhaps it would be better to work within existing retraining programs and technical schools.

  22. > It’s so obvious. Nothing government does ever works. Ever. Gosh, I don’t get it.

    Karl, you *almost* had it. Just tone down the cynicism a tad.

  23. So what’s your suggestion, geniuses?

    (1) Stop wasting money on job training programs.

    (2) Cut back the size of the government and lower taxes.

    (3) Let people find their own way through life. Without the burden of a massive state, they will have many more opportunities.

  24. How much training do you need to be a janitor?

  25. The problem with job training is people tend to choose training in fields they think they will like or think will be easy rather than where the jobs are. My brother just finished 9 mo. training as a welder. He said he always wanted to do welding, that’s great, but guess what, no ones hiring inexperienced welders. There’s are reason math oriented careers are in demand right now, as Barbie said “Math is Hard”. No one wants to make any effort.

  26. Sean W. Malone,

    That was an excellent summary and I love that saying. Mind if I ‘borrow’ it? I’ll give you full credit! 🙂

  27. Karl,

    “moral” libertarians (such as myself) dont have to worry about our “theory” being proved or not. We value freedom for its own sake, not because it “works”.

    Or, too put it more succintly, fuck utilitarianism!

  28. Sean writes much better than I do, but he didnt use the word “fuck” enough. Hmmm…that might be reason #1 he writes better than I do.

  29. The Broken Window Fallacy, as mentioned above, is the foundation of ALL of the Left’s “solutions” to problems. The government does not create, it steals and breaks windows. It is pretty simple really, it explains why these government programs don’t work. You just have to understand and accept as true the Broken Window Fallacy.

  30. No, it was Malibu Stacy that said math is hard. She also can be quoted as saying “let’s forget about all our troubles with a big bowl of strawberry ice cream”, right after getting job retraining in shopping from the local Community College.

  31. Karl, I have your paper work filled out. Grab a shovel, you are assigned Sector-17. Tell Louie I sent you.

    Oh, you never thought you would be on the receiving end of the ideas you espouse. That is real cute. Now get your ass out there, pronto.

  32. No need to credit me, I didn’t make it up… no clue who did, but it is a great wording.

  33. I use the word fuck way too often in my rants… Sometimes I like to class it up a bit.

  34. Another possible reason retraining results in marginal rehiring is because people generally don’t “train down”. The recent burst bubble resulted in the loss of a large number of jobs in the financial sector. The government’s solution? Creating jobs in the civil engineering & construction sector. How many folks with MBAs and degrees in Finance are going to retrain and learn to run a Caterpillar? That’s what I though.

  35. The phrasing of the article delivers a harsher verdict than what the data in the national data shows.

    For one thing, the article didn’t mention the wide variation in results among states implementing the Workforce Investment Act’s Dislocated Worker program. Only 12 states were included in the study and not Washington state. In fact, in Washington state, this program works well.

    It’s also important to note that comparisons between participants and non-participants can include a bias against the program. Displaced worker training programs tend to attract workers who will not be able to find work without some kind of training while those who don’t participate in such programs (and are in the comparison group) are more likely to be able to find a job and move on without training.

    The Workforce Training and Education Coordinating Board monitors the performance of Washington’s training programs. Our most recent report (http://www.wtb.wa.gov/wtr2008)shows 78 percent of retrained workers were employed nine months later. Their median annualized earnings were just shy of $30,000. Participant satisfaction neared 90 percent.

  36. ondigo wrote: ” The government’s solution? Creating jobs in the civil engineering & construction sector.”

    Yeah, because nobody in construction lost jobs. It was all Wall Street.

    Spare me the tears for the downtrodden and overpaid of wall street. Guess what happens when banks cut back on lending because they need to shore up their swiss cheese balance sheets? Construction projects get put on hold. There’s a big hole in downtown Boston where an old Filene’s was supposed to be turned into a new hirise development. Nothing’s been done for months, because they couldn’t get financing. All the people who’d have been working on it are not working on it.

    And I’m guessing construction workers generally have less of a cushion to fall back on, union or no, than overpaid wall streeters. Last I heard, the Wall Streeters who got laid off are partying in Argentina.

  37. Tomcat1066 wrote: ” Then, they can at least study something they are actually interested in and are free to work in that field if they so choose”

    Because people never study something they’re interested in, graduate, and find that there are no jobs, even when they pay their own way and aren’t in some gubmint program.

    Are you an undergrad, by any chance?

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