Synopsis: Return on Investment Analysis of a Selected Set of Workforce System Programs in Indiana

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To complement the 2nd NCHEMS Performance Report (2009), the Indiana Chamber contracted with Dr. Kevin Hollenbeck of the W.E. Upjohn Institute (Upjohn) to calculate the net impact and return on investment for Indiana’s public workforce training programs. By law, Upjohn completes this type of analysis every four years (2002, 2006, and 2010) in the State of Washington, which operates a highly acclaimed workforce training and evaluation system. Upjohn also has undertaken similar analysis for the State of Virginia. In Washington, Upjohn findings have been used to drive policy changes: for example, Upjohn found that apprenticeship programs pay off especially well compared to other training programs, so Washington is placing additional emphasis on apprenticeships; further, Upjohn found that adult basic education did not payoff unless combined with technical/postsecondary training, so the state has made changes to blend adult education with technical training/degree programs.

Given the potential of Upjohn’s work as a policy analysis and resource allocation tool, the Indiana Chamber of Commerce Foundation contracted for analysis of all workforce training programs for which data was accessible. Unfortunately, whereas Upjohn was able to gather data for 11 different training programs in Washington and 9 programs in Virginia, in Indiana Upjohn was able to obtain data for only 5 different training programs, so the results are less comprehensive than would be ideal. Still the following data should give policymakers a feel for the potential this tool offers to compare the impact of different types of workforce training programs, conduct “what if” analyses about potential policy changes, and compare subgroups within each type of program.

Upjohn’s study in Indiana included people who exited five types of training programs in the state fiscal year 2006. It tracked trainees for seven quarters (nearly 2 years) after they had exited training programs. The five training programs were:

1. WIA Adult (2,697 people)
2. WIA Dislocated Workers (1,891 people)
3. WIA Youth (1,782 people)
4. Trade Adjustment Act (2,855 people)
5. Public postsecondary - associates degree or less (12,452 people)

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