Not Just a Summer Job: Reducing Incarceration Rates for At-Risk Youth

In December 2014 aggregated unemployment in the United States was at 5.6 percent, the lowest it’s been in six years. However, for young adults aged 20-24 years, the unemployment rate was twice the normal rate, at 10.8 percent. And for youth aged 16-19 years, the unemployment rate was triple the national rate, at 16.8 percent.

While many young people may not be employed because they are still in school, it is estimated that 2.6 million young Americans want or need to work but cannot find a job. In attempts to address this, the government has a variety of policy interventions and programs. These programs typically benefit individuals from low-income families and include jobs at summer camps, daycare centers, government agencies, hospitals, museums, and retail organizations.

A new study evaluates the impact of government-sponsored youth employment programs in New York City. In “The Effects of Youth Employment: Evidence from New York City Summer Youth Employment Program Lotteries”, Gelber, et al., look at data for the period 2005-2008 from the New York City Summer Youth Employment Program (SYEP). The program included paid jobs sponsored by the New York City government at a total cost of $236 million for youth aged 14 to 21. As the demand for summer jobs exceeded the number of offered positions, the program used randomized lotteries to select the applicants. This process allowed the authors to compare, ex-post, outcomes of selected and non-selected individuals with similar socio-economic characteristics.

The data from SYEP was matched with data from the IRS, New York State Department of Corrections and Community Services, and New York City Department of Health and Mental Hygiene. This introduced data for income, employment history, criminal history, and mortality for each individual. In the four years studied, there were 294,580 SYEP applications of which 164,977 won the lottery and subsequent employment.

Gelber, et al., claim the goals of summer programs like SYEP include increasing the income for low-income families, developing skills to improving future employment opportunities for youth, and incentivizing youth to abstain from criminal-related activities. The authors then measure the effects of these programs on earnings, probability of having a job, college enrollment, incarceration rates, and mortality rates during a four-year period after the individuals’ application to the program. They compared these values for randomly selected participants and non-participants in the SYEP.

In the analysis the authors found that the income received by SYEP participants substituted income from private jobs and that participation did not have significant positive impacts on future earnings or probability of future employment. The study also found no impact on future school enrollment.

By contrast, the authors found a reduced probability of future incarceration of 54 percent from the baseline incarceration rate for 19-21 year olds. They also identified a reduction in the rate of mortality (particularly homicide and death by other external causes) by 21 percent relative to the control group. Future research should be done to try to explain these findings.

This study prompts a number of questions on the different effects of Summer Youth Employment Programs. The Department of Labor 2014 budget included $12.5 billion for Pathways Back to Work Funds for youth employment. As governments seek cost-effective programs it is critical that they identify and measure all costs and benefits of these interventions.

Given this analysis, government-sponsored youth employment programs may be a promising way to encourage youth from low-income families toward a path that leads away from criminal-related activities and negative outcomes.

Article Source: Gelber, Alexander, Adam Isen, and Judd Kessler. “The Effects of Youth Employment: Evidence from New York City Summer Youth Employment Program Lotteries.” NBER Working Paper No. 20810. December 2014.

Feature Photo: cc/(University of Fraser Valley)