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

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....

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Bibliographic Details
Published in:American economic journal. Applied economics 2010-07, Vol.2 (3), p.96-128
Main Authors: Autor, David H., Houseman, Susan N.
Format: Article
Language:English
Subjects:
Applied economics
Contractors
Economic models
Economic theory
Economics
Employee placement
Employment
Employment statistics
Human capital
Instrumental variables
Instrumental variables estimation
Job hunting
Labor economics
Labor market
Labor markets
Low skilled workers
Point estimators
Quarterly estimates
Return to work programs
Skilled workers
Studies
Temporary employment
Welfare
Welfare reform
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Summary: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.
ISSN:1945-7782
1945-7790
DOI:10.1257/app.2.3.96