# Presentation: 791375

## Using Training Program Vouchers: The Individual Training Account Experiment

**Sheena McConnell**
**ACF/OPRE Welfare Research and Evaluation Conference **
**June 4, 2007**

## Overview

**Background**
**ITA Experiment**
**Findings**

## Background

## Why Use Training Vouchers?

**Promotes choice**
**Promotes competition among training providers**
**Reduces capacity constraints**
**But:  ill-informed customers could make poor choices**

## History of Training Voucher Use

**Under JTPA (1982-1998), agencies mostly contracted for training slots**
**Many agencies experimented with the use of training vouchers**
**The Workforce Investment Act of 1998 required the use vouchers for most training**

## Individual Training Accounts

**Vouchers required by WIA are known as Individual Training Accounts or ITAs**
**Training program chosen must be on Eligible Training Provider (ETP) list**
**Consumer Report Systems provide information on programs**
**Local agencies given flexibility on how to administer them**

## Best Way to Implement ITAs Unknown

**How much counseling should be required?**
**Should counselors have the right to veto choices deemed inappropriate?**
**Should the ITA have the same value for everyone?**

## ITA Experiment

## Objectives 

**Objectives **

**Test three different approaches to administering ITAs**
**Three approaches chosen so that include:**
***Approach most frequently used***
***A more structured approach***
***An approach that gives customers more choice***

## Approaches Tested

|  | Approach 1:  
Structured Customer Choice | Approach 2:
Guided 
Customer 
Choice | Approach 3:
Maximum
Customer
Choice |
| --- | --- | --- | --- |
| Counseling | Mandatory;
most intensive | Mandatory;
moderate intensity | Voluntary |
| Can Counselors Reject Choices? | Yes | No | No |
| Award Amount | Customized | Fixed | Fixed |

## Research Questions 

**Research Questions **

**How do the approaches compare in terms of:**
*Use of counseling*
*Take-up of ITAs*
*Training *
*Employment and earnings*

## Evaluation Design

**Evaluation Design**

**Approaches tested side by side in eight sites**
**Nearly 8,000 customers randomly assigned to one of three approaches**
**Study tracking system**
*7,920 study participants*
**15-month follow-up survey**
*4,800 sampled*
*3,933 responded (82%)*
**UI state administrative records**

## Findings

## Staff Struggled With Being Directive

**Staff Struggled With Being Directive**

**Approaches 2 and 3 implemented as designed**
**Staff struggled to implement Approach 1**
*Deferred to customers’ occupation preferences*
*Did not steer to low-cost training*
*Reluctant to deny funds*

## When Counseling is Voluntary, Customers Rarely Request It

**66***

**59**

**  ****4***

- Source: Study Tracking System.  * indicates significantly different from Approach 2

## Counseling Requirements Discourage Take-up of ITAs

**59**

**58**

**  ****66***

- Source: Study Tracking System.  * indicates significantly different from Approach 2

## Highest Expenditures for Approach 1, Lowest Expenditures for Approach 2

**Highest Expenditures for Approach 1, ****Lowest Expenditures for Approach 2**

|  | A1: Structured Choice | A2: 
Guided Choice | A3: Maximum Choice |
| --- | --- | --- | --- |
| Average price of selected programs | $4,947* | $3,608 | $3,579 |
| Average ITA amount per ITA recipient | $4,625* | $2,861 | $2,888 |
| 
Percent received ITA  | 59% | 58% | 66%* |
| Average cost per customer | $2,756* | $1,621 | $1,848* |

- Source: Study Tracking System.  * indicates significantly different from Approach 2

## No Effect on Overall Training Rates

**64**

**64**

**  ****66**

- Source: 15-month survey.  * indicates significantly different from Approach 2

## Approaches Did Affect Timing of Training

**Approaches Did Affect Timing of Training**

|  | A1: Structured Choice | A2: 
Guided Choice | A3: Maximum Choice |
| --- | --- | --- | --- |
| Quarter 1 | 46% | 46% | 50%* |
| Quarter 2 | 48 | 44 | 48 |
| Quarter 3 | 39* | 34 | 37 |
| Quarter 4 | 30* | 24 | 28* |
| Quarter 5 | 25* | 20 | 21 |

- Source: 15-month survey.  * indicates significantly different from Approach 2

**Percentage in Training, by Quarter**

## No Effect on Overall Employment

**80**

**79**

**  ****81**

- Source: 15-month survey.  * indicates significantly different from Approach 2

## Approaches Did Affect Timing of Employment

**Approaches Did Affect Timing of Employment**

|  | A1: Structured Choice | A2: 
Guided Choice | A3: Maximum Choice |
| --- | --- | --- | --- |
| Quarter 1 | 32% | 31% | 27%* |
| Quarter 2 | 46 | 45 | 43 |
| Quarter 3 | 59 | 58 | 57 |
| Quarter 4 | 68 | 65 | 68 |
| Quarter 5 | 74 | 72 | 75 |

- Source: 15-month survey.  * indicates significantly different from Approach 2

**Percentage Employed, by Quarter**

## Earnings Impacts Similar to Employment Rates

**Earnings Impacts Similar to Employment Rates**

|  | A1: Structured Choice | A2: 
Guided Choice | A3: Maximum Choice |
| --- | --- | --- | --- |
| Quarter 1 | $1,345 | $1,307 | $1,071* |
| Quarter 2 |   2,687 |   2,604 |  2,305 |
| Quarter 3 |   3,624 |   3,522 |  3,369 |
| Quarter 4 |   4,381 |   4,240 |  4,160 |
| Quarter 5 |   4,994 |   4,790 |  4,819 |
| Quarters 1-5 | $17,032 | $16,464 | $15,724 |

- Source: 15-month survey.  * indicates significantly different from Approach 2

**Earnings**

## Little Effect on Job Characteristics

**Little Effect on Job Characteristics**

**Distribution of occupations was similar**
**No differences in number of job quits, firings, or lay-offs**
**Fewer A1 customers received fringe benefits**
*Health insurance, paid time off, retirement*

## Summary

**Summary**

**Approaches 1 and 3 more costly to government than Approach 2**
**Impacts on training and employment are minimal**
**Counseling does not dramatically affect  customer choices**