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Return on Investment in Workforce Development Programs

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Abstract

Under more and more fiscal scrutiny because of shrinking state and local budgets, workforce development programs are being asked to estimate their return on investment (ROI). This paper introduces basic concepts of ROI in workforce development programs. It distinguishes ROIs estimated for workforce programs from those that are estimated for financial investments or capital projects. The paper furthermore exposits the basic ingredients of an ROI study—identification of the treatment and time periods of analysis, identification of the net impacts of the program, and identification of net costs. Finally, the paper presents results from the estimation of the ROI for postsecondary career and technical education in the State of Washington.

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  • Kevin Hollenbeck, 2012. "Return on Investment in Workforce Development Programs," Upjohn Working Papers 12-188, W.E. Upjohn Institute for Employment Research.
    • Handle: RePEc:upj:weupjo:12-188
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    1. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, March.
    2. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    3. Kevin Hollenbeck, 2011. "Short-Term Net Impact Estimates and Rates of Return," Book chapters authored by Upjohn Institute researchers, in: Douglas J. Besharov & Phoebe H. Cottingham (ed.), The Workforce Investment Act: Implementation Experiences and Evaluation Findings, chapter 12, pages 347-370, W.E. Upjohn Institute for Employment Research.
    4. George E. Hoffer & Robert J. Reilly, 1983. "Analysis," Challenge, Taylor & Francis Journals, vol. 26(4), pages 56-57, September.
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    More about this item

    Keywords

    Return on investment; present value; net present value; benefit cost analysis; workforce development; postsecondary CTE; Washington state; human capital;
    All these keywords.

    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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