Private Employers and TANF Recipients. 4.1  Analyses of Existing Data Sources

05/25/2004

As indicated in the last chapter, the employer surveys directed by Harry Holzer in the late 1990s stand out as some of the most important available data sources. Several noteworthy research documents based on analyses of these survey data were cited in Chapter 2. However, these surveys clearly offer opportunities for additional analysis. The survey questions concentrate on employer willingness to hire welfare recipients, the extent to which they have actually hired recipients, and their experience with the recipients they have hired. Yet Holzer's survey instrument also includes a number of questions about employer practices, notably recruitment, screening, and hiring. In addition, the instrument has several questions about labor market intermediaries, including questions about whether an employer has worked with specific intermediaries in each of the four metropolitan areas.

This is the only existing dataset that could be used to address the unanswered questions highlighted at the outset of this chapter. These survey data, which were collected consistently from a large sample of urban employers, cover several employer practices in meaningful detail. It would be possible, for example, to analyze employment outcomes for individual intermediaries or groups of intermediaries in the four metropolitan areas. It would also be possible to compare outcomes for employees who were hired using different recruitment and screening practices.(17)

The advantages of such analyses are apparent: The data are readily available, the analysis would be relatively inexpensive and, at least for some employer approaches and practices, additional analysis could be very informative. The disadvantages arise principally from the limitations of these survey data: they are limited to four cities, were collected a full five years ago, in a different economic and welfare policy environment than presently exists, and do not address some of the most important issues examined in this report (e.g., the specific ways in which employers utilize labor market intermediaries).

The surveys of labor market intermediaries carried out for the Welfare to Work Partnership in the Atlanta and New Orleans metropolitan areas also could provide the basis for valuable new analyses. Surveys were completed with more than three-quarters of all intermediaries identified as working with TANF recipients in those two areas. Straightforward analyses  such as an assessment of the types of services provided to employers by different types of intermediaries  would complement other research on intermediaries and the employment of TANF recipients.

The disadvantage of other existing data sources, in terms of addressing the unanswered questions, is that they lack information on employer practices. For example, the WIA program data system  WIASRD  contains information on publicly supported training, but not on private training supplied by employers. This means it would be possible to assess the effects of alternative training practices for a subset of labor market intermediaries (those with WIA funding), as discussed in the next section. However, the practices of employers could not be examined.

WIASRD can be linked to data on employee wages  based on Unemployment Insurance (UI) reporting system used by employers  but the quarterly records offer limited insight into employer compensation practices. For example, hourly wage rates and fringe benefits cannot be determined from these data.

While WIASRD would not help with the unanswered questions, it could provide, once linked to TANF data, a more complete and up-to-date answer to ASPE's fifth question  Which segments of the TANF population present the greatest challenges? This question could be addressed with data on individual characteristics, deferrals, and exemptions. While analysis of these data would not shed new light on some issues (which are not fully captured in these administrative data), such as the effects of mental illness on employment, it would provide better estimates of the prevalence of a wide range of barriers.

Another important dataset is the one developed by the Census Bureau's LEHD program. A number of studies have already utilized the LEHD data, including two cited in the last chapter. The core of the dataset is UI wage record files, and the LEHD program currently includes states accounting for roughly half of total U.S. employment over an extended period, with that coverage expected to grow in the near future. These quarterly UI data have been integrated with employer records, basic demographic information and, for a limited subsample, survey data from the Current Population Survey (CPS), Survey of Income and Program Participation (SIPP), and decennial census.(18)

There is limited but important information about employer practices in the LEHD dataset. For example, detailed questions about employer-provided training are asked on one wave of the SIPP. This employee-reported information could potentially be combined with other SIPP and non-survey data in the LEHD dataset- such as employer size and industry, job classification and characteristics, and worker characteristics, length of employment, and earnings and fringe benefits - to compare activities and outcomes across different types of employee training. The data might also be useful in providing additional information on the types of employers that hire TANF recipients.

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