The New Jersey Unemployment Insurance Reemployment Demonstration Project: Final evaluation report (Corson et al. 1989)
Absence of conflict of interest: This study was conducted by staff from Mathematica Policy Research, which administers CLEAR. Therefore, the review of this study was conducted by an independent consultant trained in applying the CLEAR causal evidence guidelines.
Corson, W., Decker, P.T., Dunstan, S.M., Gordon, A.R., Anderson, P., & Homrighausen, J. (1989). The New Jersey Unemployment Insurance Reemployment Demonstration Project: Final evaluation report. Princeton, NJ: Mathematica Policy Research.
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- The study’s objective was to examine the short-term impacts of the New Jersey Unemployment Insurance Reemployment Demonstration Project on the unemployment insurance (UI) receipt, employment, and earnings of UI claimants in New Jersey approximately one year after program enrollment.
- In this demonstration, about 11,000 UI claimants were randomized into one of three treatment groups, all of which received some variation of Job Search Assistance (JSA) services, or into the control group, which could receive only existing services in the community. For all participants, the study team collected administrative data, which provided information on UI receipt, employment, and earnings. The study team also surveyed a subsample of roughly 7,500 participants about their experiences in the year following random assignment.
- The study found that all three treatments reduced at least one measure of UI benefits received in the benefit year. According to the survey data, the JSA-only and JSA-plus-bonus groups had higher employment and earnings in the year following participants’ initial UI claims than control group members (no difference was found for the JSA-plus-training group). However, these impacts were not observed in the administrative data.
- The quality of causal evidence presented in this report is high because it is based on a well-implemented randomized controlled trial. This means we are confident that the estimated effects are attributable to the interventions studied, and not to other factors.
- See more CLEAR profiles related to The Reemployment Bonus Experiments.
Implemented in 10 randomly selected UI offices across New Jersey, the demonstration mandated participation in JSA services for displaced workers who were recently unemployed to foster their quick reemployment. The demonstration had three service offerings: (1) JSA only; (2) JSA plus training or relocation services; and (3) JSA plus a reemployment bonus. All three interventions shared the same JSA components: an orientation session and testing; five half-day job-search workshop sessions at local New Jersey UI offices; a one-on-one counseling and assessment session with office staff; and a requirement to maintain contact with the demonstration office, either by discussing job-search activities with office staff or using the office’s resource center to conduct job-search activities.
The JSA-only group received no services other than JSA services. In the JSA-plus-training group, staff informed participants about training and relocation services available and helped participants plan their training options. In the JSA-plus-reemployment-bonus group, participants who became reemployed quickly received a bonus equal to one-half of the person’s remaining UI entitlement at the time of the assessment if he or she found employment within two weeks; the bonus declined in value by 10 percent of the original amount per week. Participants received 60 percent of the bonus if they held the job for 4 weeks, and received all of it if they were employed for 12 weeks. Bonuses were not available to claimants who were rehired by their former employers; were employed by a relative; or were in temporary, seasonal, or part-time work.
Eligibility screening for the demonstration excluded claimants who (1) had not received their first UI payment, had their first payment more than five weeks after their initial claim, had a partial first payment, or a special type of claim (such as a claim by an ex-service member); (2) were younger than 25 years old; (3) had been on their previous job for fewer than three years; (4) had a specific date for being recalled by their former employer; and (5) were typically hired through union hiring halls.
Features of the Study
All those eligible for the demonstration were randomly assigned to the JSA-only group (2,416 participants), JSA-plus-training group (3,810 participants), JSA plus-reemployment-bonus group (2,449 participants), or the control group (2,385 participants). Administrative UI data were collected from initial intake into the study (sometime from July 1986 to June 1987) for one year. Employment and earnings data came from two sources: (1) quarterly wage records through the first quarter of 1988 and (2) a follow-up survey. About 7,500 sample members were identified for the survey, which was fielded from January to August 1988, and included self-reported information on earnings and employment.
To measure impacts on UI receipt, employment, and earnings, the authors compared the outcomes of members of each of the three treatment groups with those of the control group.
- The study found that the JSA-only, JSA-plus-training, and JSA-plus-reemployment bonus groups reduced at least one measure of UI benefits received in the benefit year relative to the control group.
- According to the survey data, the JSA-only and JSA-plus-reemployment-bonus groups had higher employment rates and earnings in the year following participants’ initial UI claims than control group members (no difference was found for the JSA-plus-training group). The earnings differences were greatest in magnitude—approximately $100 to $200 per quarter—and statistically significant during the first two quarters following the initial claim, with the differences disappearing by the third quarter.
- The earnings impacts were not observed when the analysis instead used administrative data.
Considerations for Interpreting the Findings
The authors estimated multiple related impacts in the UI benefit receipt, employment, and earnings domains. Doing so increases the probability of identifying statistically significant differences by chance. Therefore, the number of statistically significant findings in these domains is probably overstated. In addition, the labor market, UI program, and reemployment services have changed considerably since this study was conducted. Therefore, a similar study conducted in the current environment might find different results.
Causal Evidence Rating
The quality of causal evidence presented in this report is high because it is based on a well-implemented randomized controlled trial. This means we are confident that the estimated effects are attributable to the interventions studied, and not to other factors.