I so often criticize the New York Times for doing stenography for officialdom that I feel compelled to point out a case of good reporting on an Obama initiative I’ve seen criticized in other venues and failed to shred on NC.
The Times piece focuses on a Georgia “tryout” program in which workers still on unemployment get to work for free for prospective employers for a maximum of 24 weeks (correction, 8 weeks). The employer is under no obligation to hire anyone. Needless to say, this program is more than a tad skewed in favor of companies. But it costs no money and creates the impression the government is Doing Something. So since no one in DC wants the government to spend more money, particularly on little people, this gimmick is perfect fit with the “let them eat cake” zeitgeist.
Key sections of the Times piece:
….economists say there is little evidence that participants find work faster. And a lack of promotion, limited oversight and budget constraints have limited the program, Georgia Works, to a tiny portion of the state’s nearly half a million unemployed workers. Only about 120 people have been hired because of it this year…
Since the program began in 2003, only 18 percent of those who completed the training have been hired by the employer that trained them, according to data released this week by the state labor department. More recently, job placement has declined to about 10 percent. New Hampshire, North Carolina and Missouri report far better results from their programs, though they are still quite small. The Obama administration estimates that if every state opted in, the program would cost $1 billion to $1.5 billion.
Supporters of the effort say that hirings are not the only measure of success. The program keeps the unemployed tethered to a workplace environment. It can provide training — under federal labor laws that forbid unpaid labor, it is required to, though the state labor department’s literature refers to it as a “free trial” for employers.
The part I find sus is the “training” claim. While the article does provide an example of a worker who learned how to write smartphone apps, a lot of “training” new workers get is “how we do stuff around here.” Learning the ropes is important to becoming productive in any company, but a lot of it is not transferrable to other employers. The story confirms my suspicions:
Georgia State has hired 37 workers through the program, out of 54 who have begun trial periods. But the overseers of the program there acknowledged that for many, the program was more valuable as a foot in the door than as a learning experience.
The Obama Administration is going to sweeten the pot a bit, but minimum wage pay is well below a living wage in most of the US:
Unions and labor advocates like the National Employment Law Project have criticized the program as free labor for employers rather than training. The White House has tried to neutralize that complaint by ensuring that under its proposal, called Bridge to Work, the worker would receive the equivalent of minimum wage. States may apply for money to bolster unemployment benefits and to provide stipends for travel and child care, which would come out of a $4 billion federal fund meant to cover that and other re-employment programs in the jobs bill.
I suspect that the efforts to tweak the program will reduce what little impact it might have. The whole premise was to give employers a free look at workers. Even then, the results were underwhelming. The Administration claims it will monitor whether employers actually hire people and will kick out employers who take too many look-sees, but that still does not mean employers won’t intentionally or unwittingly abuse the initiative.
And who are we kidding? A program that does not create new jobs, and allows workers to be paid less than they might otherwise be if a company had to hire them, actually had the net effect of REDUCING income paid to workers. The only impact may be changing who gets hired (program participants v. others) and perhaps the company saving some money by not having to run ads that might be plowed back into wages. But the latter effect is likely to be trivial.
This program is further proof of why Obama deserves to lose in 2012. As our Richard Kline said:
To me, the best possible outcome of the present market trauma would be for a spectacular implosion between now and November, 2011 turning Barack Obama into a certifiable carbon shadow on a blast wall such that the Democratic Party has to abandon him on the lip of the primary season, leading to a wild scramble for the Democratic candidacy.