Peter Van Buren kvetches about federal job training programs:
Obama’s new call for job training also belies the fact that the government already spends approximately $18 billion a year to administer 47 job-training programs. The actual value of those programs remains unclear. The Government Accountability Office found that only five programs assessed whether people who found jobs did so because of the program and not for some other reason. In addition, the GAO learned that almost all training programs overlap with at least one other training program. “Federal job training sounds like something that should boost the economy,” writes the Cato Institute’s Chris Edwards and Daniel J. Murphy in a 2011 report, “but five decades of experience indicate otherwise.”
The panacea myth of job training crosses party lines. The GAO reported that in 2003, under the George W. Bush administration, the government spent $13 billion on training, spread across 44 programs. Job training may again be on the GOP agenda, even if the parties differ on the details. Politically, some sort of job training just sounds good. The problem is that it won’t really help America’s 9.5 million unemployed.
$18 billion is a lot of money. If you divided it among 1 million people it would be $18,000 each.
The key problem is that the jobs just don’t exist. Here’s Mr. Van Buren’s prescription:
Jobs. Jobs that pay a living wage. The 2008 recession wiped out primarily high- and middle-wage jobs, with the strongest employment growth in the recovery taking place in low-wage employment, to the point where the United States has the highest number of workers in low-wage jobs of all industrialized nations.
There are many possible paths to better-paying jobs in the United States where consumer spending alone has the power to spark a “virtuous cycle.” That would mean more employment leading to more spending and more demand, followed by more hiring. One kickstarter is simply higher wages in the jobs we do have. For example, recent Department of Labor studies show that the 13 states that raised their minimum wages added jobs (at higher wages of course) at a faster pace than those that did not. On a larger, albeit more contentious scale, are options such as a WPA-like program, changes to tax and import laws to promote domestic manufacturing, infrastructure grants and the like. There’s the $18 billion being spent on job training that could be repurposed for a start.
I remain somewhat skeptical about increasing the minimum wage—I’d need to be confident the increase was helping more people than it hurt. As I’ve said before I have no hostility to a WPA-type program. That seems to be a non-starter in Congress.
Other proposals I’ve made from time to time: apprenticeship programs, wage subsidies. I’ve just thought of another one: train to suit. Let’s say there’s a job available and there are candidates who are missing some qualification or other. Get an agreement that you’ll train them to suit the requirements.
What we’ll undoubtedly do is persist in useless job training program whose most important results are the jobs of the people administering it.