Stimulating Opportunity: An Evaluation of ARRA-Funded Subsidized Employment Programs

“In 2009, in its efforts to stimulate the economy through the American Recovery and Reinvestment Act (ARRA), Congress included funding in the Temporary Assistance to Needy Families (TANF) Emergency Fund (EF) to help states cover the costs of creating new or expanding existing subsidized employment programs” (p. 1).

“While the TANF EF grants expired in September 2010, the programs had strong support from employers, workers, and state and local officials from across the political spectrum. Several states continue to operate subsidized employment programs, and significant new investments in the strategy have been proposed at the federal level. With support from the Rockefeller Foundation, the Economic Mobility Corporation (Mobility) conducted a retrospective study of TANF EF-supported subsidized employment programs in five locations to investigate what we could learn about workers’ and employers’ experiences to inform future policy and program design decisions. Our findings were based on an analysis of data provided by the states on participants’ characteristics, subsidized employment experiences, and pre-and post-program employment and earnings and a survey we conducted with participating employers.

Our report provided evidence about the effectiveness of subsidized employment programs in helping the unemployed re-enter the labor market while stimulating job growth and addressing employers’ workforce needs. It also offered lessons about how program design influences worker and employer outcomes” (p. 1). (Abstractor: Author).

The main findings about program effectiveness include the following: • “Subsidized employment programs can have a significant positive impact on low-income job seekers’ employment and earnings” (p.1) • “Most employers created jobs that would not have existed otherwise. Sixty-three percent of employers across the states we examined said they generated jobs that would not have existed otherwise in order to employ the subsidized workers, suggesting that subsidized employment programs can help stimulate business growth” (p.2). • “The long-term unemployed experienced particularly large employment and earnings gains. The subsidized employment programs we studied offered particular benefits to job seekers who had been unemployed for more than six months” (p.2). • “Programs also benefited participants with significant barriers to employment. Individuals with significant barriers to employment, including TANF recipients and those with criminal records, also experienced large increases in unsubsidized employment and earnings from the year before to the year after participating in the programs” (p.2). (Abstractor: Author)

• Last Updated:
• Created:
• Resource Publication Date: 2013
• Author(s): Roder, Anne; Elliott, Mark
• Organizational Author(s): Economic Mobility Corporation
• Funding Source: Rockefeller Foundation
• Resource Availability: Publicly available
• Posted by: Laura Aron
• Posted in: Workforce System Strategies