Do Temporary-Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from “Work First”

David Autor · Susan N. Houseman

227 citations0/0 files storedAmerican Economic Journal Applied Economics

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Labor market dynamics and wage inequality Gender, Labor, and Family Dynamics Employment and Welfare Studies

Abstract

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. (JEL J22, J23, J24, J31, J68)

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2007Experimental Analysis of Neighborhood Effects 2003Outsourcing at Will: The Contribution of Unjust Dismissal Doctrine to the Growth of Employment Outsourcing 2002Temporary Jobs: Stepping Stones or Dead Ends?2008From temporary help jobs to permanent employment: what can we learn from matching estimators and their sensitivity?2006Incarceration Length, Employment, and Earnings 2000Why Employers Use Flexible Staffing Arrangements: Evidence from an Establishment Survey 2001Why Employers Use Flexible Staffing Arrangements: Evidence from an Establishment Survey 1997The Growth of Temporary Services Work

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