# Presentation: 135703

## UK ERAThe UK’s Employment Retention and Advancement (UK ERA) Demonstration

**Implementation and First-Year Impact  Findings**

**James A. Riccio**
- (james.riccio@mdrc.org)
**MDRC**
**June 2007**

**PSI**
**Policy Studies Institute**

**ONS**
**Office for National Statistics**

## Policy Aims

- Launched in late 2003
- Builds on UK’s New Deal welfare-to-work program (“work-first”)
- Promotes “sustainability and progression”
- Supports government’s broader agenda to   increase lone-parent employment and reduce child poverty

## 3 Target Groups

**Out of work and entering New Deal:**
**(1) “New Deal 25-Plus”** **(ND25+)** **** mostly men; age 25+; _mandatory_ for New Deal
**(2) “New Deal Lone Parents” (NDLP)** **** mostly women, on income support (welfare); _volunteer_ for New Deal
**In work (lone parents):**
**(3) Working Tax Credit (WTC) group******** **mostly women working  part time (16-29 hours/wk)

## Program Features (1): Services 

**Operates within Jobcentre Plus             **(Welfare + employment agencies)
**For the 2 New Deal groups:  **~ 9 months of regular New Deal  _pre-employment__** **_assistance (e.g., job placement)
**For all groups:  **2 years of “in-work” job coaching and support

## Programme Features (2): Incentives

_**Retention bonus**_** ****for sustained full-time work ** £400 3x/year for 2 years (£2,400 total)
_**Tuition assistance**_** if combine training + work **** **£1,000
_**Tuition bonus**_** if complete training **** **up to £1,000
_**In-work emergency funds**_** **** **£300/_worker _

## The Sites

**6 districts:**
- 4 in **England**
- (E. Midlands, London, NE England, NW England)
- 1 in **Scotland**
- 1 in **Wales**
**Spread across 60 local offices**** **(where random assignment took place)
**Results for WTC Group: mostly from 1 district** (East Midlands)

## Compared to What? 

_**For ND25+ and NDLP **__***(out-of-work)***__** Groups:**_
_**For WTC **__***(in work)***__** Group:**_

**New Deal intake and RA**

**P **
**(ERA)**

**C**

_**New Deal**_
**(+ advancement focus)**

**New Deal**** **

**In-work** **support + incentives**

**RA**

**P**** ****(ERA)**

**C**

**In-work** **support + incentives**

***JOB***

***JOB***

***JOB***

## This Report

**Qualitative implementation findings:**
**Cover ~** **2.5 years **
* **From program start (Nov’03) **** Spring ’06*
**Service receipt and early impacts:**
-  Cover _**1 year**_ after random assignment
-  Mostly survey-based (so far)

## Implementation

- Little P vs. C  “treatment difference” during           New Deal _pre-employment_ phase
- Bigger “in-work” (post-employment) treatment difference during 1st year, but low quality
-  Substantial improvements by 2nd year
- Can’t yet observe impact payoff of improvements
- Many ND participants *had not yet worked* in first year—ERA not yet fully tested on them

## Working Controls:  Any “help/advice” from Jobcentre Plus staff while in work

** **

**Base =  **_**WORKERS**_** in Control Group  **

**NDLP**

**WTC**

**ND25+**

***Received ***_***in-work***_*** help/advice?***

## Working Ps vs. working Cs:  More likely to get in-work “help/advice”

** **

**NDLP**

**WTC**

**ND25+**

*Note: Comparisons are nonexperimental*

***Received ***_***in-work***_*** help/advice?***

**Base =  **_**WORKERS**_** in P group vs. C  Group  **

## RETENTION Bonus

** **

**Aware?  **

**Received? **

**NDLP**

**NDLP**

**WTC**

**ND25+**

**ND25+**

**WTC**

**Base = All Ps**

## TRAINING Bonus

** **

**Aware? **

**Received? **

**NDLP**

**NDLP**

**WTC**

**ND25+**

**ND25+**

**WTC**

**Base = All Ps**

## Controls:  WORK OUTCOMES 

** **

**Ever worked since RA?**

**Working at interview?**

**NDLP**

**NDLP**

**WTC**

**ND25+**

**ND25+**

**WTC**

## Impacts on WORK OUTCOMES 

** **

**Ever worked since RA?**

**Working at interview?**

**-2 pp**

**+5 pp****

**+2 pp**

**+2 pp**

**0 pp**

**-2 pp**

**NDLP**

**NDLP**

**WTC**

**ND25+**

**ND25+**

**WTC**

## Controls: % in FULL-TIME work

** **

**Working full-time at month 12 ?**

**NDLP**

**ND25+**

**WTC**

## Impacts on FULL-TIME work

** **

**Working full-time at month 12 ?**

**+3 pp**

**+7 pp*****

**+10 pp*****

**NDLP**

**ND25+**

**WTC**

## Controls:  EARNINGS

** **

**Average earnings, year 1 (£)**

**NDLP**

**WTC**

**ND25+**

## Impacts on EARNINGS

** **

**Earnings in year 1**

**NDLP**

**WTC**

**ND25+**

**+291**

**+811*****

**+57**

**Average earnings, year 1 (£)**

- (+12%)

- (+29%)

- (+0.7%)

## Earnings impacts by district:  NDLP  

**+142**

**+740**

**+631**

**+1,386*****

**+1,002****

**+648**

## Earnings impacts by district:  ND25+

**+725**

**+177**

**+560**

**+230**

**-1,013***

**+891****

## Controls:  WORK + TRAINING  

** **

**Combined education or training with work?**

**NDLP**

**WTC**

**ND25+**

## Impacts on WORK + TRAINING 

** **

**+14 pp*****

**+5 pp*****

**+3 pp*****

**NDLP**

**WTC**

**ND25+**

**Combined education or training with work?**

## Controls:  BENEFIT RECEIPT

** **

**Receiving benefit at month 12 ?**

**NDLP**

**WTC**

**ND25+**

***Jobseekers ***
***Allowance***

***Income***
***Support***

***Working ***
***Tax Credit***

## Impacts on BENEFIT RECEIPT

** **

**-4 pp**

**-4 pp****

**-5 pp****

**NDLP**

**WTC**

**ND25+**

**Receiving benefit at month 12 ?**

***Jobseekers ***
***allowance***

***Income***
***support***

***Working ***
***Tax Credit***

## Next Steps 

- 2-year impact report ~ next March (2008)
- If 2nd phase of evaluation is funded, will do longer-term impact and benefit-cost studies