Employment Retention and Advancement (ERA) Scheme

Duration:

July 2003 to April 2011

PSI researchers:


Genevieve Knight

Kathryn Ray

Sandra Vegeris

Francesca Francavilla

Alan Marsh

Karen Mackinnon

Background, summary and aims

ERA was a demonstration project for a new policy to help lone parents and long-term unemployed people improve their labour-market position. ERA services were available from 2003 to 2007 in six Jobcentre Plus Districts in the UK. This intervention was conceived as a 'next step' in welfare-to-work policy in Britain, building on the dual strengths of providing personal advice to jobseekers and making work pay when they find it. ERA was designed specifically to interrupt the 'low-pay-no-pay cycle' that has frustrated some of the success of the New Deal. ERA members who got jobs continued to receive help from their Advancement Support Adviser (ASA) at their local Jobcentre Plus office for 33 months. ASAs helped their customers into suitable work, to avoid early pitfalls in work and to advance in their jobs. Those working 30 hours a week or more could receive a retention bonus whose instalments could amount to £2,400 over their time in ERA. More cash support was available for training and for meeting the costs of setting up in work.

Three groups known to have difficulties in getting and keeping full-time work were eligible for ERA:

  • Out-of-work lone parents entering the New Deal for Lone Parents (NDLP)
  • Lone parents working 16-29 hours a week and receiving Working Tax Credits (WTC)
  • Long-term unemployed people entering the New Deal of 25-Plus (ND25+).

Pilot schemes in labour-market policy have typically made new services like ERA available in some areas and compared these with similar people in similar areas elsewhere for evidence of improvement. ERA differs in being a demonstration project, modelled on similar projects in the United States, which randomly assigns eligible participants into a programme or control group. In this case, the programme group receives ERA services and the control group receives only its normal New Deal services or none, as appropriate. Thus, the circumstances of the control group will be a true measure of what would have happened to the programme group had they never been offered ERA or received any of its services and incentives. In addition, a demonstration project involves the researchers more closely in the implementation of the new services. In each district, a Technical Adviser assisted Jobcentre Plus staff in their work, supervised and assisted random assignment, and generally helped ensure that the programme was delivered to specification.

Evaluating ERA: the research

The evaluation was undertaken by a consortium comprising the Manpower Demonstration Research Consortium (MDRC), the Policy Studies Institute (PSI), the Institute for Fiscal Studies (IFS) and the Social Survey Division of the Office for National Statistics (ONS). This was the first time a demonstration project of this kind was used to evaluate a labour-market initiative in Britain, and the design of ERA owed much to the experience of MDRC in New York. MDRC is currently running similar schemes in several states of the USA.

The evaluation of ERA was divided into four research strands:

  • A Process Study - to show how ERA operated and why the observed outcomes may have arisen. This study drew on a wide range of data, including both qualitative and quantitative surveys of staff and customers and observational data from offices;
  • An Impact Study - counted the effects of ERA upon its customers both in terms of work outcomes such as incomes, terms and conditions of service and non-work outcomes such as housing, family formation and so on. The impact study used multiple sources, including large quantitative face-to-face surveys of programme-group and control-group members and the analysis of administrative data;
  • A Cost Study - found out what ERA really cost to operate, including on-site observations of the time spent delivering services;
  • A Cost-Benefit Study - found out whether the outcomes were worth that cost compared to the total gain and compensating gains from tax and foregone benefit entitlements.

Phase one of the evaluation was completed in 2008, when two reports were published detailing the two-year impacts for lone parents and long-term unemployed participants, respectively. Phase 2 was completed in spring 2011 when the five-year impact data was published.

Plans are progressing to make the ERA data available in a public use data set available from the UK data archive. For more information please contact the UK project leader Genevieve Knight.

Final Findings in Brief

At the time ERA was launched, the New Deal programmes and Jobcentre Plus offered participants who entered work little further assistance once they obtained jobs. ERA was thus a major departure from ‘business as usual’, and there was no guarantee that Jobcentre Plus could implement the model. The evaluation found that, after initial start-up problems, and despite variations in quality across offices and staff, ERA was largely implemented as designed, attesting that it was feasible to attach a post-employment component to the work of Jobcentre Plus or other employment agencies. But was the model an effective one?

ERA produced short-term earnings gains for the two lone parent target groups: the NDLP and WTC groups, which were made up mostly of women. The early gains resulted from increases in the proportion of participants who worked full time (at least 30 hours per week). This pattern aligns with the programme’s requirement that participants work full time in order to qualify for the employment retention bonus. These effects generally faded in the later years, after the programme ended. However, an earnings gain appears to have lasted longer among NDLP participants who were better educated, though initially unemployed. Compared with other unemployed lone parents, this group may have had more unrealised potential to succeed in work, which ERA may have tapped into. From a cost-benefit perspective, ERA did not produce encouraging results for the lone parent groups, with the exception of the NDLP better-educated subgroup.

More impressive were the results for the long-term unemployed participants (mostly men) in the ND25+ target group. For them, ERA produced modest but sustained increases in employment and substantial and sustained increases in earnings. These positive effects emerged after the first year and were still evident at the end of the follow-up period. The earnings gains were accompanied by lasting reductions in benefits receipt over the five-year follow-up period. ERA proved cost-effective for this group from the perspectives of the participants themselves, the Government budget, and society as a whole. This is a noteworthy achievement for a group that is widely considered among the most difficult to help.

Outcomes


  • Hendra, R., Riccio, J.A., Dorsett, R., Greenberg, D.H., Knight, G., Phillips, J., Robins, P.K., Vegeris, S. and Walter, J. with Hill, A., Ray, K., and Smith, J. (2011) Breaking the low-pay, no-pay cycle: Final evidence from the UK Employment Retention and Advancement (ERA) demonstration Department for Work and Pensions Research Report no. 765, Corporate Document Services

    Read the report

  • Chowdry, H. and Sianesi, B. (2011). Non-participation in the Employment Retention and Advancement Study: Implications for the experimental fourth-year impact estimates. Department for Work and Pensions Working Paper No 96, Sheffield: Department for Work and Pensions.

    Read the paper

  • Sianesi, B. (2011) Employment Retention and Advancement (ERA) demonstration: The impact on workers outcomes Department for Work and Pensions Research Report 759, Sheffield: Department for Work and Pensions

    Read the report

  • Hendra, R.; Ray, K.; Vegeris, S.; Hevenstone, D. and Hudson, M. (2011) Employment Retention and Advancement (ERA) demonstration: delivery, take-up, and outcomes of in-work training support for lone parents Department for Work and Pensions Research Report 759, Sheffield: Department for Work and Pensions.

    Read the report

  • Greenberg, D.; Walter, J. and Knight, G. (2009) The cost of services and incentives in the UK Employment Retention and Advancement (ERA) demonstration: Preliminary analysis, Department for Work and Pensions Working Paper No 64. Corporate Document Services.

    Read the paper

  • Miller, C., Bewley, H., Campbell-Barr, V., Dorsett, R., Hamilton, G., Hoggart, L., Homonoff, T., Marsh, A., Ray, K., Riccio, J. and Vegeris, S. (2008) Implementation and second-year impacts for New Deal 25 Plus customers in the UK Employment Retention and Advancement (ERA) demonstration DWP Research report

    Read the report

  • Riccio, J., Bewley, H., Campbell-Barr, V., Dorsett, R., Hamilton, G., Hoggart, L., Marsh, A., Miller, C., Ray, K. and Vegeris, S. (2008) Implementation and second-year impacts for lone parents in the UK Employment Retention and Advancement (ERA) Demonstration DWP Research report no 489

    Read the report

  • Dorsett, R., Campbell-Barr, V., Hamilton, G., Hoggart, L., Marsh, A., Miller, C., Phillips, J., Ray, K., Riccio, J., Rich, S. and Vegeris, S. (2007) Implementation and first-year impacts of the UK Employment Retention and Advancement (ERA) demonstration, DWP Research Report 412.

    Read the paper [pdf]

  • Hoggart, L., Campbell-Barr, V., Ray, K. and Vegeris, S. (2006) Staying in work and moving up: evidence from the UK Employment Retention and Advancement (ERA) Demonstration DWP Research Report no 381

    Read the report

  • Hoggart, L., Walker, R. and Hamilton, G. with Blank, S. (2006) Making Random Assignment Happen: Evidence from the UK Employment Advancement and Retention (ERA) Demonstration. Department for Work and Pensions, Research Report no. 330 . ISBN: 1-84123-981-X

    Read the report

  • Hall, N., Hoggart, L., Marsh, A., Phillips, J., Ray, K. and Vegeris, S. (2005) The Employment Retention and Advancement Scheme - the early months of implementation DWP Research Report no 265

  • Morris, S., Greenberg, D., Riccio, J., Mittra, B., Green, H., Lissenburgh, S. and Blundell, R. (2003). Designing a demonstration project: An Employment Retention and Advancement demonstration for Great Britain. UK Government Chief Social Researcher's Office, London: Cabinet Office.

    Read the paper

Related publications / project outputs

The Employment, Retention, Advancement Scheme: Summary Report on the Implementation of ERA

Designing a demonstration project: An Employment Retention and Advancement demonstration for Great Britain

The cost of services and incentives in the UK Employment Retention and Advancement (ERA) demonstration: Preliminary analysis

Non-participation in the Employment Retention and Advancement Study: Implications for the experimental fourth-year impact estimates

Implementation and second-year impacts for New Deal 25 Plus customers in the UK Employment Retention and Advancement (ERA) demonstration

Breaking the low-pay, no-pay cycle: Final evidence from the UK Employment Retention and Advancement (ERA) demonstration

Employment Retention and Advancement (ERA) demonstration: delivery, take-up, and outcomes of in-work training support for lone parents

Implementation and second-year impacts for lone parents in the UK Employment Retention and Advancement (ERA) Demonstration

Employment Retention and Advancement (ERA) demonstration: The impact on workers outcomes