Moving Up Instead of Moving Around: The Benefits of Industry-Specific Training for Low-Income Workers

by Maureen Conway
Director, Workforce Strategies Initiatives
The Aspen Institute

A study by the Aspen Institute has found that industry-based workforce organizations consistently meet their objectives to improve low-income individuals’ employment opportunities and the quality of the jobs that they can obtain. The Aspen Institute’s longitudinal survey provides some of the first evidence available about the long-term labor market experiences of individuals who have participated in industry-based training programs. 

Better Opportunities for Low-Income Workers

After participating in industry-specific training programs, most workers have improved their position within their local labor markets, often to a dramatic degree. 

Most participants came to these programs with a history of work experience—largely a series of low-wage jobs that that did not provide a foundation upon which to advance within the labor market. After participating in programs providing industry-specific training and education, however, participants were able to alter their long-term employment experience and prospects. Study findings show they improved the wages they earned and increased the number of hours they worked during the year, leading to a substantial increase in overall earned income.

Improvements Continue Over Long-Term

The study also demonstrates that in the second year following industry-specific training, workers generally built on their initial improvements, further increasing their wages, hours worked, and overall income—in contrast with past patterns. As a result of training and education tailored to industry needs, low-income workers no longer simply shifted from one job to another without advancing. Instead, most participants were able to build a foundation in the labor market from which to rise. For example, median personal earnings rose from a baseline $4,144 to $13,650 in the first year following training, to $16,894 in the second year after training. In addition, the percentage of respondents who worked at some point during the year grew from 72 percent before training to 94 percent in the first year after training. The percentage of individuals who were working year-round increased from 23 percent prior to training, to 57 percent in the first year following training, to 67 percent in the second year following training.¹

The following chart outlines these findings. 

*Employment status numbers shown are for the 332 respondents who completed all three waves of the survey; earnings numbers reflect the experience of the 296 among the 332 that reported their personal earnings in all three waves.

Quality Training Increases Quality of Life

In addition to greater wages, job benefits such as health insurance, paid sick and vacation leave, pension plans, and others were markedly improved post-training. Specifically, 78 percent of the main jobs that participants held during the first and second years after training provided access to health insurance, compared to 50 percent prior to training. The proportion of participants who actually received health insurance through their jobs rose from 53 percent in the first year following training, to 65 percent in the second year, an increase perhaps due to improved employment stability. Substantial percentages of participants also reported receiving other employment benefits such as paid vacation (77%), paid sick leave (64%), and pension other than Social Security (59%).

Responses to survey questions also show that participants generally feel better about the quality of their jobs and their opportunities for advancement after the training, and that they attribute this improvement to their experience with the training program. For example, 82 percent of all respondents said that they believe their future job prospects are better today due to their participation in industry-specific training programs. Many also expressed an increased desire to further develop their skills and education credentials, and exhibited confidence in their own ability to achieve their goals. 

Lessons Learned

The majority of findings from the participant survey are strong indicators of progress, but it is important to note that industry-based workforce development is not a quick fix; nor is it a panacea for all individuals. Two years after training, a substantial minority of survey respondents was still struggling towards self-sufficiency. For these participants, layoffs, personal or family illnesses, and other issues frustrated their ability to maintain ground and advance in the labor market. 

The study shows that even among those still experiencing economic hardship at the end of the study, progress was made in the work opportunities and wages they were able to obtain. While results for the majority of respondents were quite positive, there is nothing magical about the two-year mark following program participation. Depending on life experiences and a host of other factors, some individuals have a much longer and steeper path to climb out of poverty than others. 

The economic strides made by the majority of the survey sample following their participation in industry-based workforce programs demonstrate the effectiveness of this approach. The nonprofit organizations that participated in this study successfully combined skills training relevant to particular industry and occupational employment opportunities, along with support services and a training atmosphere tailored to participants’ unique needs. The findings of the Aspen Institute study suggest that industry-specific workforce initiatives warrant additional attention and support. This approach has achieved success working with low-income job seekers where they are, helping them move closer to attaining goals of economic independence and self-sufficiency.

Endnotes:

1  Data reported here reflect longitudinal findings. Other Aspen Institute publications also report findings for the full sample contacted. 732 individuals were interviewed at baseline, 543 were interviewed one year after training, and 371 were interviewed two years after training. Both longitudinal and full sample analyses reveal similar findings.

Maureen Conway is Director of the Workforce Strategies Initiative (WSI) at the Aspen Institute. The mission of WSI is to advance effective, market-based strategies for improving the labor market options and outcomes for disadvantaged individuals. In her capacity as Director, Maureen has managed a variety of projects including a multi-faceted project involving a longitudinal survey of over 700 industry-based training program participants, in-depth case study research on six organizations and the collection of consistent data on program characteristics and performance indicators from six programs. Currently, Maureen is managing a joint effort with the Urban Institute to evaluate the U.S. Department of Labor’s Sectoral Demonstration Program, and a new project designed to develop and test measures for assessing the benefits that industry-based training programs have for employers. Maureen’s previous experience includes consulting work for the Organization for Economic Cooperation and Development in Paris and work for the U.S. Peace Corps, where she advised on the design, management and monitoring and evaluation of the organization’s economic development programs in Eastern Europe and the Former Soviet Union. Maureen’s previous work for the Aspen Institute includes serving as Associate Director of the Local Employment Approaches for the Disadvantaged program, a research project which focused on the range of initiatives non-profit community groups engage in to promote employment opportunities for the disadvantaged. Maureen is the author of numerous publications on industry-specific workforce development including case studies, policy briefs, and research reports, and she has presented findings from her research at various national and regional conferences. Maureen has a B.A. in economics and mathematics from Holy Cross College, a Masters in Regional Planning from the University of North Carolina, and an M.B.A. from Columbia University. 

For more information, please visit the Aspen Institute's website or contact Maureen at maureen.conway@aspeninst.org.