Rethinking the Welfare State: The prospects for ... - e-Library

Rethinking the selfare state 194
The success of JSA measures, therefore, is a function of the type of unemployment
problem at hand. For frictional unemployment this strategy is appropriate. With frictional
unemployment, all that is required is to gather and provide enough information for
qualified workers and employers to find one another. For structural unemployment,
however, mere job search assistance will not be effective because it does not address the
fundamental problem—even with full information about the employment market,
individuals without the requisite skills will remain unemployed. Since job search
assistance programs and job training programs are directed at different problems, we
should not see them as substitutes, but rather as complements.
Short-term classroom training
In the United States, 43 welfare-to-work 44 classroom-training programs are highly
decentralized. Nevertheless, for the purposes of this analysis, we may categorize them by
the groups to which they are addressed—poor single parents, disadvantaged adults, and
disadvantaged youth. A large percentage of the participants 45 in each of these sorts of
programs have not completed high school. There is little difference, however, in the net
results of each program. In each case, there is only a marginal increase in employment
levels and only a marginal (if any) decrease in dependence on social assistance by
participants. 46 The US Comprehensive Employment and Training Act (CETA), which
was enacted in 1973, relied on contracting with public organizations to provide classroom
and on-the-job training and was widely viewed as ineffectual. The Job Training
Partnership Act (JTPA), enacted in 1982, sought to shift to output-based contracting with
private organizations, but pervasive creamskimming of the more readily re-employed has
substantially attenuated its effectiveness. 47 Indeed, recent studies indicate that jobtraining
programs such as JTPA have had only a marginally positive effect on dislocated
workers. Further, there is evidence that job training programs can have a negative effect
on the economically disadvantaged due to the tendency of such programs to nurture
unrealistic employment expectations among participants. 48 Targeted short-term classroom
training programs for specific subgroups of the unemployed (e.g. female labour market
re-entrants) have generally proven more effective than the provision of classroom
training to broad classes of unemployed. 49
Evidence of the success or failure of programs outside of the United States is far from
voluminous. Nonetheless, it is possible to offer some generalizations about comparative
experience. In Canada, although both classroom and on-the-job training have enjoyed
only moderate success, on-the-job training has been shown to be relatively more effective
than classroom training in improving an individual’s relative employability. 50 Jobtraining
strategies in Canada have historically been highly centralized, which is
problematic because bureaucratic processes are, for the most part, ineffective at
allocating scarce resources as efficiently as are market-oriented arrangements. It is
understandably difficult, for instance, for administrators of centrally organized programs
to know exactly what training programs will be in primary demand in coming months or
years in various geographical areas, and what types of programs would particularly suit
the talents, ambitions and interests of incoming participants. Consequently, centrally
arranged contracts with providers of training, such as community colleges, which make
provision for a certain number of students in certain courses, are likely to be grossly