INSTITUTION Manpower Demonstration Research Corp., New York, N.Y . - Ed

YIEPP demonstration introduced two major innovations:the program modelV,itself -- where 16- to 19-year-old disadvantaged youths were offered apart-time job during the school year and a full-time job in the summer onthe ccndition that they stay in school and meet academic and job-relatedperformance standards -- and the scale of implementation, where the joboffer was extended to all eligible youths in 17 designated demonstrationareas.Over 76,000 youths joined and were given jobs during the fulldemonstration period.In 1977, the Department of Labor's Office of Youth Programs contracted with the Manpower Demonstration Research Corporation (MDRC) to conductthe research and overseethe operationsof the YIEPP demonstration.Based on an agenda identified in the 1977 Youth Act, a large, four-partresearch program was designed to address:(1) the number of youths toparticipate from among those eligible and the program's short- and longer-run impacts on employment and schooling behavior; (2) the feasibility ofthe program model and other operational lessons;demonstration and its replication or expansion;(3) the cost of theand(4)a number ofspecial issues, including the quality of work provided to the youths andthe significant role of businesses in an unprecedented private sector jobcreation effort.Reports issued to date have covered the initial period of programimplementation, early impacts, and many special issues.The two reportspublished at this time summarize the implementation and impact lessonsfrom the full 30-month demonstration period and provide cost data.Afinal report scheduled for 1983 will examine whether YIEPP had longer-10

term, post-program effects on the youths' educational and employmentbehavior.The two current volumes contain significant findings about the YIEPPapproach.Somewhat surprisingly,the implementation report indicatesthat the prime sponsors did not encounter major problems in meeting thedifficult challenges of delivering on a job guarantee.What proved moretroublesome was the enforcement of the school performance conditions, aresponsibility shared with the school systems involved.start-up difficulties,thereportsuggeststhatHowever, despitethe demonstration'soverall record was one of significant managerial achievement.Perhaps the most compelling part of the program's record, as seen inboth of these reports, is its success in attracting black youths: theyare seen joining YIEPP in greater numbers and staying in it longer thanany other group.This finding is particularly significant in the contextof the experience of the pest 25 years, when there has been a consistentand dramatic declinemales.in minority youth employment,particularly forThus, while in 1955 black male youths were employed at the samerate as whites, by 1981 their employment rate had been cut in half, whilethat of white youths remained constant or improved.A similar, thoughsomewhat less dramatic, story holds true for young minority women.While these facts are clear, the explanation is not.Before theYIEPP demonstration, there had been relatively little evidence to help insorting among the conflicting explanations of job shortages, discrimina-tion, lack of motivation, unrealistic wage expectations, or the attraction of more profitable extra-legal alternatives.YIEPP, with its jobguarantee, provided a unique, direct mechanism to test youths' interest

in working.The striking finding in the impact study, where YIEPP isseen to double minority youths' school-year employment rates -- bringingthen essentially equal to or exceeding those for white youths -- suggeststhat the prevailing low employment rate is not voluntary.YIEPP'simpacts on school enrollment, while more modest, are also positive.While the program did not reverse declining enrollment as youths' progressed through high school, it slowed this down, through both reducingthe drop-out rate and increasing the numbers of youths returning toschool.From the varied lessons in both reports, YIEPP emerges as a program-matic intervention that encourages school completion and the compilationof a work-history.Moreover, the program proved feasible to implement onan extremely large scale.The management record of the YIEPP primesponsors is testament to the fact that large numbers of jobs can bedeveloped to alleviate youth unemployment, and that these jobs canprovide a meaningful work experience.Perhaps, most of all, YIEPP hasshown that, when jobs are available, young people do want to work -- evenat the minimum wage, and even while still continuing in school.While a job guarantee as a solution to large-scale labor marketweaknesses may not seem currently affordable, the lessons on the YIEPPmodel itself are of pointed relevance.essential to the rest of the program model.The guarantee itself was notYIEPP could be operated as aslot program while still retaining its other features; in fact, thisoccurred in a transition year immediately following the demonstrationperiod.Much of the YIEPP experience should be of inter2st in view ofthe new Job Training Partnership Act, which reflects the country's1 2 3(7

continued focus on preparing youths for employment and on models thatlink school and work, demanding performance from the youths in exchangefor a job.In short, these two reports provide many lessons that futureplanners of youth programs will find instructive.Judith M. GueronExecutive VicePresidentManpower DemonstrationResearch Corporation1ai-:

EXECUTIVE SUMMARYThe Youth Incentive Entitlement Pilot Projects demonstration (YIEPP)was a large-scale test of a school-conditioned, guaranteed jobs programfor teenagers from low-income families.Authorized by the Youth Employ-ment and Demonstration Projects Act of 1977, the denwnstration was based,in part, on the theory that both school completion and work experiencegreatly enhance the employment prospects of teenagers.previous youth employment programs, it tied schoolTherefore, unlikeand work together byoffering jobs to all youths who met the eligibility criteria and alsoagreed to remain in or return to school.The program's job guarantee was the nation's first.19-year-olds livingAll 16- toin one of the program's 17 project areas, whosefamily incomes were at or below the poverty level or who came fromfamiliesjobs.receiving welfare, were eligibleto participateandreceiveThe program tested the willingness of the private sector to helpprovide these jobs through the provision of full wage subsidies toparticipating firms, and created a further opportunity for programplanners to examine whether and to what degree collaboration might emergebetween the schools and local YIEPP prime sponsors through the schoolrequirements of the program.The demonstration began in February 1978 and ended full-scaleoperations in August 1980.During this period, over 76,000 youths wereemployed by YIEPP work sponsors at 17 project sites across the country,operated by competitively-selected CETA prime sponsors.sites were large, encompassing all orcounty areas.Seven of thelarge parts of cities or multi-These Tier I sites were expected to enroll from 3,000 to

9,000 youths at any one time, while the ten smaller Tier II sites anticipated average enrollments of from 140 to 800 youths.This is the final report on the implementation of the program modeland its feasibility, covering the 30-month demonstration span.It drawstogether findings from the earlier reports on implementation, fromseveral special studies, and from the in-program impact findings onY1EPP's effects on the school enrollment and employment levels of thetarget population.In addition, as requested by Congress in the YouthAct, the report presents the final cost figures on the demonstration, aswell as estimates on the costs of running a national program.The analysis of feasibility focuses on the two main sets of tasksprime sponsors carried out in the implementation of the program, bothrepresenting a substantial challenge.of the entitlement,of jobsforOne set centered on the deliveryespecially the development of a sufficient numberthe target population.Running an "entitlement," ratherthan a fixed slot program, meant that prime sponsors had to preparefor continuous job developmentto place the ongoing -- and often un-predictable -- flow of enrollees.Moreover, outreach was extensivesince prime sponsors were expected to inform the eligible youths of their"right" to a program job.The second cluster of tasks revolved around the enforcement ofthe program's basic eligibility requirements andits school performanceand attendance standards, both of which required procedures that werenew to prime sponsors and more rigorous than in previous programs.sponsors were to check age,Primeincome, residence and school enrollment ofyouths at program entry, and to reverify all criteria periodically.1 51-xiv-

Simultaneously, they had to set up procedures to learn if the youths weremeeting the attendance and performance standards of the schools.Thistask required the cooperation of the local school systems, institutionsover which prime sponsors generally had little control.Additionally,for each set of tasks, both the quick start-up of the demonstration andthe press of the numbers of entering youths caused a variety of problemsthat were particularly severe during the program's initial year.How-ever, responsibilities that were at first novel and difficult became moreroutine for prime sponsors as the demonstration progressed.The principal findings from this report on the YIEPP implementationare sumarized below:Outreach and Enrollment of Eligible YouthsOutreach efforts were generally successful in informing largenumbers of eligible youths about the program's availability.According to survey results in four of the large Tier I sites,91 percent of those eligible at the start of the program hadheard about it by its conclusion.Participation rates were high.Fifty-six percent of theyouths eligible at the beginning of the program had worked inOf those who hearda program job by the demonstration's end.appliedtoenroll, indicatingof the program, four out of fivethat there was a great deal of interest among disadvantagedyouths in obtaining minimum-wage jobs.Outreach was more effective for in-school youths than fordrop-outs, and participation rates were also higher for inOf those eligible youths already in school,school youths.94 percent heard of the program and 63 percent participated.In comparison, 75 percent of the drop-outs heard about theprogram and 25 percent participated. In addition to being lessaccessible to outreach efforts, drop-out youths tended to beolder, self-supporting, and heads of households and thereforewould presumably have had less interest in minimum-wage jobsproviding only part-time employment during most of the year.The participation rate for black youths (57 percent) after 18months of program operations was substantially higher thanthat for white youths (17 percent), with the participation rate

for Hispanics (34 percent) falling in between the .two.Bythe demonstration's end, black, Hispanic, and white participation rates were 63, 38, and 22 percent respectively.Thedifference between white and minority participation rates isprobably explained by the greater opportunities available tonon-Hispanic whites in the unsubsidized labor market.Participation rates also varied among sites because of differences in local labor markets and implementation strategiesused for outreach, enrollment, and job assignment.Participation rates could have been even higher had prime9sponsors not lost c.ime youths in the process from applicationto job assignment, a problem that was especially severe duringthe first year of the demonstration at the large Tier I sites.By the demonstration's conclusion, however, 93 percent of thoseenrolled had received program jobs, although some youths were"lost" between application and enrollment.Duration of Participation and TerminationOn average, youths participated in the program for a period of41 weeks. Youths already enrolled in school averaged 42 weeks,(about 10 months), while returning drop-outs stayed 27 weeks,or about 6 months.Duration of participation varied with age.Younger eligiblesstayed longer than older ones, a fact that is not surprisinggiven their longer period of eligibility.Black youths participated for longer periods than whites,staying in the program about six weeks more. This difference-- like the higher participation rates for blacks -- is pro-bably explained again by the relatively restricted opportunities for black youths in the unsubsidized labor market.Of those youths terminated during the demonstration, 32 per-cent left the program because of high school graduation,18 percent resigned, 17 percent dropped out of school, 13percent were terminated for poor job performance and attendance, 7 percent became ineligible for other reasons (age,income, and residence), 3 percent were terminated for violatingschool standards, and about 10 percent for a variety of otherreasons.Reasons for termination varied sharply between youths alreadyenrolled in school and former drop-outs.Of the terminatedin-school youths, 35 percent left because they had graduatedfrom high school compared to 11 percent of the drop-outs whohad returned to school.Conversely, as compared to 13.3percent of the in-school youths who were terminated because

they dropped out of school, 46 percent of the drop-outs wereterminated because they left school once again.Job Development and Job AssignmentParticipating prime sponsors, on the whole, had a sufficientsupply of jobs to keep up with the flow of new enrollees.Because of low labor demand, considerably more effort wasrequired to develop jobs in rural areas such as Mississippi.Over 10,000 worksites were developed during the demonstration.Most of the jobs developed were typical entry-level youthjobs. The three largest categories were clerical (27 percent),building maintenance (26 percent), and community recreationaides (15 percent).The average number of youths assigned to a work sponsor waslow, ranging from five per sponsor at public schools andother public agencies to fewer than two at private businesses.The quality of work in the demonstration was, on the whole,adequate or better, with some 86 percent of the worksitesThis assessment was based on suchfactors as whether or not the youths were kept busy, whetherfalling into this category.they were held to performance standards, whether there wasrelatively close and substantive supervision, whether the workwas varied, and whether there was a low ratio of participantsto supervisors.The Role of the Private SectorThe number of private sector worksites grew steadily over thework sponsorscourse of the demonstration, and over half of all6,000 of thebusinesses(55percentornearlywere privateprovidedTheproportionofworkhours10,000 work sponsors).youthssponsoredonaveragefewerby the private sector, whichdemonfromthefirstfewmonthsoftheper worksite, doubledstration, when it was 10 percent, to the last full year, whenit reached over 23 percent.theThe major incentive to private sector participation was100 percent wage subsidy initially offered to the businesscommunity everywhere but in Mississippi (where it was 75Another inducement to.private sector participationpercent).whichwil3 a centralized payroll maintained by the prime sponsorminimized paperwork for work sponsors.Private sector participation was highly sensitive to the wageA special wage subsidy variation experimentsubsidy offered.ofconducted in Detroit and Baltimore found that 18 percentthe employers offered the full subsidy agreed to sponsor18xviia

participant, compared to 10 percent at a 75 percent wageIn othersubsidy and 5 percent at a 50 percent wage subsidy.words, had the maximum subsidy been offered at the traditionalCETA on-the-job training level of 50 percent, job developerswould have had to contact almost four times as many privatesector employers to recruit the same number of worksites as atfull subsidy.A study of a large sample of worksites found no significantdifferences between the quality of work in the private, public,and private nonprofit sectors.Analysis revealed that there was a quality/worker displacementIf youths were busy and engaged intrade-off in the worksites.productive work, there was greater likelihood that, if theYIEPP wage subsidy had not been offered, the work sponsor wouldhave detailed a regular employee to do that work.Monitoring and Enforcing StandardsBecause of its entitlement and school condition features, theYIEPP program guidelines demanded far more extensive eligibility and performance monitoring procedures than were v.equiredMonitoring requirements, indeed, borein other CETA programs.a greater resemblance to those found in welfare programs.Procedurally, the checking of eligibility at enrollment wentHowever, a quality control study which independentlysmoothly.verified youths' eligibility status at enrollment at threeTier I sites found varying rates of eligibility: 81.6 percent,While income was the major83.2 percent, and 53.8 percent.cause of initial ineligibility, 40 percent of those ineligiblewould have been eligible under the alternative poverty standardof 70 percent of the Lower Living Standard. The site withthe highest rate of ineligibility did not require, as did theother two, that youths submit an independent proof of parents'income level, clearly suggesting that similar programs ought torequire such proof in the future.The quality control study showed that residence and incomechanges were not significant sources of later ineligibility.Periodic reverification of income and residency, which requiredconsiderable time and effort, did not prove worthwhile.Sites did not establish uniform requirements for attendance andperformance at worksites, probably an infeasible task sincesome local projects had as many as 2,000 sponsors active at anyEmployers held participants to their own criteriagiven time.Thirteen percent of all terminafor attendance and behavior.tions were for poor job performance or attendance, a level highenough to indicate that project staff effectively acted on therecommendations of the work sponsors to terminate youths.;-19

For a variety of reasons, standards for school performance andFirst,attendance were difficult to establish and enforce.uniform standards generally did not exist within school systems; prime sponsors had to negotiate with schools individuallyto set them, and this was a time-consuming process in theWhen standards were put intodemonstration's start-up period.effect, the administrative reporting chains within schools, andthen between schools and prime sponsors (who enforced thestandards), were lengthy and caused such lags between gradeand attendance reporting and actual enforcement that primeFinally, asponsors were reluctant to take firm action.reluctance to terminate disadvantaged youths was perceivedamong counselors, many of whom felt that these youths shouldnot be deprived of income or forced to drop out of a programwhich might have represented a "last chance" for them.Prime sponsors' continuing efforts to enforce school standardsdid, however, give the program credibility among school ofMoreover, whereficials, according to anecdotal evidence.enforcement did occur, as it did in several sites, it servedNot only did it hold youths accountableimportant functions.for their

Brookings Institution. PHYLLIS A. WALLACE. Professor Alfred P. Sloan School of Management Massachusetts Institute of Technology. NAN WATERMAN. Treasurer, Board of Directors Children's Defense Fund. EXECUTIVE STAFF. BARBARA B. BLUM, President JUDITH M. GUERON, Executive Vice-President GARY WALKER, Senior Vice-President ROBERT C. PENN, Vice-President