This article examines whether retraining helps dislocated or displaced workers find new jobs or receive comparable pay. Dislocated or displaced workers are experienced workers who are dismissed due to work-site closings or significant downsizings. The authors compare dislocated workers who received retraining to dislocated workers who did not receive retraining. They find that retraining fails to improve the probability that workers will get new jobs, get full-time jobs, get higher pay, receive decent benefits, experience acceptable working conditions, have reasonable commute times, or get new jobs with a future, that is, with reasonable security in continued employment.
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References
1.
1. In this article, we use the term “dislocated” to reflect both dislocated and displaced workers. There is a distinction in the technical literature that we need not worry about here.
2.
2. Walter Corsonet al., International Trade and Worker Dislocation: Evaluation of the Trade Adjustment Assistance Program (Princeton, NJ: Mathematica Policy Research, 1993).
3.
3. U.S., Department of Labor, Office of the Chief Economist, What's Working and What's Not: A Summary of Research on the Economic Impacts of Employment and Training Programs (Washington, DC: Department of Labor, 1995).
4.
4. U.S., Department of Commerce, July 1992. The specific dates of the recessions were November 1973-March 1975, July 1981-November 1982, and July 1990-June 1992.
5.
5. The U.S. Department of Labor is currently sponsoring sessions titled “Responsible Restructuring.”
6.
6. See the work of economist Eileen Appelbaum, Economic Policy Institute, 1995.
7.
7. Consider the historical example of the sector that most benefited from technology-induced improved productivity, direct agricultural production. It used to employ 80 percent of the workforce; now it uses 2.5 percent.
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8. The more complete explanation for this extraordinary rise is that new laws prohibited American firms from temporary import of Indian software engineers. Thus even more work than usual was obtained from Indian software writers in India.
9.
9. Peter T. Kilborn, “In New Work World, Employers Call All the Shots,”New York Times, 3 July 1995.
10.
10. Bruce Nussbaum, “Downward Mobility: Corporate Castoffs Are Struggling Just to Stay in the Middle Class,”Business Week, 23 Mar. 1992, p. 57.
11.
11. Aaron Bernstein and Wendy Zellner, “The Wage Squeeze: Productivity and Profits Are up a Lot; Paychecks Aren't; Is the Economy Changing?”Business Week, 17 July 1995, pp. 54-61.
12.
12. The Manpower Development and Training Act of 1962 and the Trade Adjustment Assistance Act of 1974. The latter was to compensate workers for income lost due to import competition.
13.
13. Corsonet al., International Trade and Worker Dislocation, p. xxi.
14.
14. Sar A. Levitan, Peter E. Carlson, and Isaac Shapiro, Protecting American Workers: An Assessment of Government Programs (Washington, DC: Bureau of National Affairs, 1986), p. 47.
15.
15. Work by John Addison and McKinley Blackburn, cited in Sylvia Nasar, “Layoff Law Is Having Slim Effect: Plant Closing Rule Full of Exceptions,”New York Times, 3 Aug. 1993.
16.
16. Seven hundred workers attended the initial base closure meeting. We obtained a list of those attendees. In fact, about 1200 worked at the base. We could not secure the full list of 1200.
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17. At the steel mill, 32 percent of workers enrolled in training or education courses after they were laid off. At the air force base, 41 percent of workers enrolled in training or education courses after they were laid off. In both locations, those who took training were no more likely to find reemployment than those who did not. At the steel mill, 65.5 percent of those who took training found jobs. However, almost the same percentage, 61.7 percent, of those who did not take training also found jobs. At the air force base, 68.0 percent of those who took training found jobs; a slightly higher percentage, 77.8 percent, of those who did not take training also found jobs.
18.
18. At Fairless, 19 percent of those with training worked part-time compared to 21 percent of those without training who worked part-time—a meaningless difference. At Williams, the difference was equally trivial: 9 percent of those with training and 14 percent of those without training accepted part-time work.
19.
19. Louis Jacobson, Robert LaLonde, and Daniel Sullivan, The Costs of Worker Dislocation (Kalamazoo, MI: W. E. Upjohn Institute for Employment Research, 1993).
20.
20. At Williams, 70 percent of the former workers saw an acceptable future for their new jobs, and 30 percent were quite positive. Only 30 percent were pessimistic about their new jobs. Note that 5 percent had already been laid off of their subsequent jobs (these we count in the pessimistic column). At Fairless, 44 percent of the former steelworkers with new jobs said that the outlook for their new jobs was good. This is lower than the 70 percent of former air force base workers who were optimistic and may reflect the lower unemployment rate in Arizona, where the base is located, at the time of the layoffs. Correspondingly, 56 percent of the former steel-workers were pessimistic and saw little hope for their new jobs. As with the air force base workers, 5 percent had already been laid off from new jobs.
21.
21. Duane E. Leigh, Assisting Displaced Workers (Kalamazoo, MI: W. E. Upjohn Institute for Employment Research, 1989), p. 142.
22.
22. Department of Labor, What's Working and What's Not, p. 53.
23.
23. Jacobson, LaLonde, and Sullivan, The Costs of Worker Dislocation.
24.
24. Sar A. Levitan and Stephen L. Mangum, The Displaced vs. the Disadvantaged: A Necessary Dichotomy? (Washington, DC: George Washington University, Center for Social Policy Studies, 1994), pp. 6, 7.
25.
25. Department of Labor, What's Working and What's Not, p. 53.
