An evidence review of worker retraining

We review the evidence on subsidized job training programs in industrial countries. We provide critical, narrative summaries of randomized studies of major job training in the US; of two "judge randomization" studies in the US and Denmark; and of previous meta-analyses. We then perform a meta-analysis of 56 randomized trials of job training in the US since 1973, the most exhaustive meta-analysis in this niche. Here, average impacts are positive but modest: employment rises 1.7 percentage points in years 3-5, and annual pre-tax earnings by roughly \$800 per person offered training. At an average cost of \$13,598 per participant, programs roughly break even under (debatable) assumptions about how long benefits persist. They recoup about three-quarters of their cost for government through higher tax revenue and lower benefit use. Evaluations of the largest federal efforts--JTPA, the Workforce Investment Act, and Job Corps--return small or null effects. One cluster of programs stands out: "sector programs," which screen applicants intensively, design curricula with employers, and track local skill demand. They raise earnings roughly ten times as much. They have proven difficult to replicate.