An evidence review of worker retraining

David Roodman and Maxim Massenkoff

Papers from arXiv.org

Abstract: We review the evidence on subsidized job training programs in industrial countries. We provide critical, narrative summaries of randomized studies of major job training in the US; of two "judge randomization" studies in the US and Denmark; and of previous meta-analyses. We then perform a meta-analysis of 56 randomized trials of job training in the US since 1973, the most exhaustive meta-analysis in this niche. Here, average impacts are positive but modest: employment rises 1.7 percentage points in years 3-5, and annual pre-tax earnings by roughly \$800 per person offered training. At an average cost of \$13,598 per participant, programs roughly break even under (debatable) assumptions about how long benefits persist. They recoup about three-quarters of their cost for government through higher tax revenue and lower benefit use. Evaluations of the largest federal efforts--JTPA, the Workforce Investment Act, and Job Corps--return small or null effects. One cluster of programs stands out: "sector programs," which screen applicants intensively, design curricula with employers, and track local skill demand. They raise earnings roughly ten times as much. They have proven difficult to replicate.

Date: 2026-09
New Economics Papers: this item is included in nep-inv and nep-mac
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