Do Temporary-Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from 'Work First'
Upjohn Institute Staff Working Paper No. 05-124
45 Pages Posted: 27 Oct 2005 Last revised: 17 Mar 2010
Date Written: August 30, 2009
Temporary-help jobs offer rapid entry into paid employment, but they are typically brief and it is unknown whether they foster longer-term employment. We utilize the unique structure of Detroit's welfare-to-work program to identify the effect of temporary-help jobs on labor market advancement. Exploiting the rotational assignment of welfare clients to numerous nonprofit contractors with differing job placement rates, we find that temporary-help job placements do not improve and may diminish subsequent earnings and employment outcomes among participants. In contrast, job placements with direct-hire employers substantially raise earnings and employment over a seven quarter follow-up period.
Keywords: Temporary-help, welfare to work, job placement, low-skill workers, causal effects
JEL Classification: J24, J48, J62
Suggested Citation: Suggested Citation