By Eric Morath
WASHINGTON -- As U.S. employers struggle to fill near-record-high job openings, government training programs aimed at solving that problem are coming up short, according to President Trump's economic advisers.
"Government job-training programs appear to be largely ineffective and fail to produce sufficient benefits for workers to justify the costs," said Tomas Philipson, a member of the Council of Economic Advisers, in an interview with The Wall Street Journal.
Most federal job-training programs produced insufficient data to be clearly evaluated, and the ones that were studied weren't producing the desired results, White House advisers said in a paper released Monday, an overview of previously completed evaluations of training programs.
There were more than 40 federal worker-training programs spread across nine different agencies serving more than 10 million Americans in the 2017 fiscal year, according to the White House.
The Republican Trump administration has proposed cutting spending on worker-training programs. Democrats have defended job-training spending in part because the programs assist those who are unemployed and can't access training through a private-sector employer. In their latest spending proposal, House Democrats allocated more dollars to the Labor Department for training than the administration sought.
The U.S. government spends less on worker training than most other developed countries, according to an Organization for Economic Cooperation and Development study cited by White House economists.
However, even if additional spending improved outcomes, the council's paper said, "it would take a large improvement for the benefits to outweigh the higher costs."
The report said the Job Corps youth-employment program and programs intended to put formerly incarcerated people back to work were producing weak results relative to their cost.
The paper also found that the Labor Department's largest program, in terms of number served, did little to help workers who were dislocated due to international trade, automation or other factors. Dislocated workers received "no significant effect on earnings from training" from the program, now known as Workforce Innovation and Opportunity Act or WIOA, several studies showed.
The paper said job-search assistance, which is provided through WIOA and other programs, provided a short-term boost to worker's wages. Mr. Philipson, however, said getting back to work quickly has to be balanced against forgoing the chance to improve one's skills.
White House economic advisers described registered apprenticeships as the exception among federal programs, with payoffs for workers in both skills and income.
A 2012 study cited by their paper found people who completed apprenticeship training earned an average of $240,037 more over a lifetime than similar nonparticipants.
The Labor Department released a proposal Monday to create a new type of apprenticeship that would be run by business groups, colleges and other entities, rather than the federal government.
The White House paper also said there is limited data on private-sector training programs, but the evidence that does exist shows they are more effective. Mr. Philipson said that suggests the government should be looking for ways to subsidize private programs or create private-public partnerships.
The paper, however, didn't provide any formal policy prescriptions.
Write to Eric Morath at email@example.com
(END) Dow Jones Newswires
June 24, 2019 15:18 ET (19:18 GMT)
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