© Copyright 2002 by the Wyoming Department of Employment, Research & Planning

Measuring the Impact of Wyoming's Workforce Development Training Fund

by:  Mark A. Harris, Sociologist, Ph.D.

"Research findings indicate that Workforce Development Training Fund (WDTF) participants experience an average hourly wage increase following training."

The primary purpose of this article is to introduce the Workforce Development Training Fund (WDTF) while providing an examination of the basic descriptive characteristics of WDTF grants and training participants. Additional objectives of this study include demonstrating whether WDTF participants remain within Wyoming after training and if they show a wage increase over time.

Research & Planning (R&P) identified WDTF participants in Wyoming Wage Records¹ and conducted a one-group pretest-posttest wage examination. Defined simply, our one-group pretest-posttest compares wages of program participants before and after training. Primary findings indicate that the demand for the WDTF has grown over time both in the number and total dollar value of grants awarded. Research findings also indicate that WDTF participants tend to be young, female, employed in the Services and Retail Trade industries, remain in Wyoming after training (at least for one year), and experience an average hourly wage increase following training.

Background Information

The Wyoming Workforce Development Council (WWDC)² is charged with creating a workforce development system that serves the needs of all Wyoming residents, students, and employers by integrating economic development, training, education, and employment opportunities. Among other duties, the Council has oversight responsibilities for workforce programs in Wyoming. The WDTF is a major training program supported by the WWDC. The WDTF was created under Wyoming Statute §27-3-210 in 1997. Revenues to the fund are generated by the interest earned on deposits to the State Unemployment Insurance (UI) Trust Fund³ and legislative appropriation. In 2001, the State Legislature appropriated $3 million to this fund. The WDTF is responsible for assisting new and existing employers with the training needs of their employees.

General Program Information

All employers, with the exception of governmental agencies, are eligible to apply for WDTF grants, including county hospitals. To qualify for a WDTF grant, an employer must be registered with the Wyoming UI program. Potential employers that are not yet registered with Wyoming UI may also qualify, but they must first register with the Secretary of State. The employer contractually agrees to provide jobs in Wyoming for the trainees at the end of the training program. These job holders must be paid at least 75 percent of either the county (in which the establishment is located or will locate) or the industry average weekly wage (as determined by the Department of Employment). In order to receive full reimbursement of the training expenses, the employer must retain the trainees for at least 90 days after the completion of training.

The grant application process is competitive. Published guidelines⁴ indicate that priority is given to employers that offer benefits and wages equal to or greater than the State average weekly wage. The Workforce Development Training Fund Training Grant Application and the regulations governing the training fund are available on the Department of Employment's web site at < http://wydoe.state.wy.us/doe.asp?ID=342 >.

Data for the Study

Employer or firm level data used for this particular study focus on the 70 employer grant contracts that ended in fiscal years 1999 (FY99), 2000 (FY00), and 2001 (FY01).⁵ Fiscal year dates are from July 1 to June 30. To illustrate, FY99 ran from July 1, 1998 to June 30, 1999. Trainee level data for this study focus on the 862 reported WDTF trainees who completed participation during FY99 and FY00 only. This cutoff is used so that there are comparable Wage Records data for a period of one year after the quarter that participants ended their training (i.e., the second quarter of 2001). Wage Records data are used to determine if each trainee had wages in Wyoming and the amount of those wages.⁶

Distribution of Program Grants

The WDTF has grown steadily since its inception. Research conducted by R&P indicates that the number of training grants completed has more than doubled each year; 6 grants in FY99, 17 in FY00, and 47 in FY01. The dollar value of grants has also grown steadily from roughly $225,000 for contracts ending in FY99 to almost $700,000 for contracts ending in FY01. Figure 1 shows the growth in the number and dollar value of WDTF contracts for the three years.

Table 1 illustrates the dollar value of WDTF grants awarded by county for contracts ending in fiscal years 1999, 2000, and 2001. Employers in more than half (13) of Wyoming's counties received WDTF grants during these three years. No employers in Carbon, Converse, Crook, Hot Springs, Johnson, Niobrara, Platte, Sublette, Washakie, or Weston counties received WDTF grants that ended during the FY99 to FY01 period.⁷ Of the total dollar value of grants for FY99 through FY01 ($1,473,917), Uinta and Natrona counties received the most (29.5% and 26.5%, respectively). Albany County obtained 18.0 percent, and each of the other counties received less than 8 percent of the total grant value. At the regional level, the Southwest (30.1%), Southeast (26.7%), and Central (26.5%) regions all received fairly similar shares of the total value of WDTF grant dollars. In contrast, the Northwest (12.1%) and Northeast (4.6%) regions were awarded much smaller amounts of WDTF dollars in the same time period.

The variation in fund distribution may be due to the higher concentration of employers in the population centers in the Central (i.e., Casper) and Southeast (i.e., Cheyenne) regions. However, given that the WDTF is a relatively new program, the unbalanced distribution of awarded grants may be due to a lack of awareness of WDTF grant availability.

Study of Program Participants

A total of 862 individuals participated in work-related training supported by the WDTF in FY99 to FY00. As shown in Table 2, these participants tended to be young, and more than half of them (54.8%) were female.⁸ Over one-third (37.0%) of these participants were less than 25 years old, another 26.3 percent were between 25-34 years old, and only 2.9 percent were 55 or older. More male participants (45.1%) were in the youngest group (under 25) than females (32.4%). Alternatively, more female participants (24.2%) were in the middle age group (35-44) than males (15.5%).

Figure 2 illustrates the industry profile for these WDTF training participants. Industry classifications are based on the participant's primary employer (i.e., the employer that pays the largest portion of the individual's quarterly wages). Primary employers are identified in Wage Records during the first quarter after the quarter training ended. As can be seen in Figure 2, of the 862 participants, most were concentrated in two industries, Services (39.4%) and Retail Trade (36.0%). The next largest industry was Manufacturing with 7.3 percent. Each of the remaining known industries had less than 5.0 percent of the trainees.

Although these initial descriptive results are informative, given the fact that the WDTF is still a relatively new program, it is possible that the basic demographic distributions of WDTF participants by gender, age, and industry may change as outstanding contracts end and more participant data become available.

Results from a Search of Wage Records

As mentioned previously, a primary focus of this study is to determine whether WDTF participants remain in Wyoming's labor market. Retention of training participants in Wyoming is important because, theoretically, it increases the pool of skilled labor available in the State, which is attractive to employers that want to remain in or relocate to Wyoming. R&P's interest is in whether the participant remained in Wyoming with any employer. As such, our search of Wage Records includes both employers that received WDTF grants and those that did not.

Results of a Wage Records search indicate that 95.0 percent of the 862 WDTF participants earned Wyoming wages one quarter (three months) after the training ended (see Table 3). Six months after the quarter training ended 86.2 percent of participants (743) were found in Wyoming Wage Records, and 79.9 percent (689) still remained one year after the quarter training ended. This result indicates that the majority of WDTF participants remained in Wyoming UI covered employment for at least one year following training.

One quarter after the quarter training ended is used as the initial search quarter because WDTF training fund regulations do not require the employer to hire the trainee participant until after the training is completed. Once the training contract is completed the employer must demonstrate that employees are retained on their payroll for at least 90 days in order to receive remaining grant monies. Thus, we would expect all participants to show up in Wage Records during the quarter after training ended. However, 43 participants (5.0%) were not found. Some wage information was inaccurately reported for a few employees as part of the employer's Quarterly Contributions Report (QCRs)⁹ or it was not reported on time, which may account for the missing records.¹⁰

Results from a One-group Pretest-posttest

One of the primary goals of the Wyoming Workforce Development Council (WWDC), which has oversight responsibilities for the WDTF, is to "increase the economic opportunity and self sufficiency for all Wyoming workers…."¹¹ One strategy the WWDC proposes for accomplishing this is to "take advantage of programs with demonstrated success in wage progression."¹² Given this thrust, R&P sought to determine the wage experience of WDTF participants.

We conducted a one-group pretest-posttest wage study.¹³ This study is based on the 712 trainees who had wages in both the quarters before and after the training ended. Mathematically, the formula for calculating average hourly wages is the sum of total quarterly wages for all individuals divided by total quarterly hours worked. Total quarterly hours worked may increase or decrease depending upon the assumptions made about how many hours, on average, individuals work on a weekly basis. In this data set, we have no way of determining how many hours were actually worked by individuals in a week. Thus, we present average hourly wages calculated for both 35- and 40-hour work weeks. Total quarterly wages of the participants are used here, instead of wages from the training employer only, because skills gained from the training employer may lead to an increase in wages at their other jobs as well.

Table 4 indicates that, for a 35-hour work week, WDTF participants received $8.95 an hour one quarter before the training ended and $9.96 an hour one quarter after training ended. To place these average hourly wages within a larger context of Wyoming wages, Table 5 provides statewide hourly wage data from the Estimates Delivery System (EDS)¹⁴ for the fourth quarter of 2000. Since 75.4 percent of the FY99 and FY00 WDTF participants were employed in either Retail Trade or Services, we focus on comparative information from EDS for these two industries. As shown in Table 5, the mean hourly wages for Retail Trade and Services are $8.78 and $12.78, respectively. Average hourly wages for WDTF participants fall between these figures.

Results of the one-group pretest-posttest wage examination indicate an average hourly wage increase of 11.3 percent after training (from $8.95 before training to $9.96 after training for a 35-hour work week; and from $7.83 before training to $8.71 after training for a 40-hour work week). This means that, on average, participants earned approximately $1.00 an hour more in the quarter after training ended than in the quarter before the training ended, which would seem to indicate training provided through the Workforce Development Training Fund led to an increase in the wages of participants.

What we do not know yet is how the WDTF participants' wage experience compares to a group of individuals with similar demographic and earnings characteristics who did not participate in WDTF training. For instance, the experience of participants could simply mirror a matched control group, or they may have done better or worse than a matched set of individuals who did not participate in the training. Having a matched control group will help isolate programmatic effects from other factors, such as inflation or changes in hours worked. All we can say for sure at this point is that, as a group, WDTF participants experience an average hourly wage increase. Future research by R&P will use a matched control group.

Conclusion

The WDTF has grown since its inception, and the number of contracts and dollars expended has increased over the life of the program. Demographic analysis of individual participants indicates that they tend to be young, female, and employed in the Services and Retail Trade industries. Substantive research results show that the bulk of WDTF participants can be found in Wyoming Wage Records up to four quarters after the quarter training ended. Moreover, results of a one-group pretest-posttest study design show that, as a group, participants experience about a $1 per hour increase in wages subsequent to training. However, additional research needs to be conducted to determine if wage increases are similar to the experience of a matched control group.

¹Wage Records is an administrative database. Each employer in the State who has employees covered under Unemployment Insurance, by law, must submit quarterly tax reports to the State showing each employee's Social Security Number (SSN) and wages earned in the quarter. Wage Records has a two-quarter time lag (e.g., wage information for first quarter 2001 employees is generally not available until third quarter 2001). For more information, see Wayne M. Gosar, "Insurance Wage Record Summary: A New Way to Look at Wyoming," Wyoming Labor Force Trends, May 1995, pp. 4-8.

²For more information regarding the organizational structure, mission, and goals of the Wyoming Workforce Development Council, see
< http://wydoe.state.wy.us/wfd/wwdc.htm >.

³The Wyoming State Unemployment Insurance (UI) Trust Fund was created in 1997 under W.S. §27-3-209 for paying UI benefits. For more information on the UI Trust Fund, see the State's website at
< http://legisweb.state.wy.us/statutes/titles/title27/chapter03.htm >.

⁴Vicky Lynn Hawn, Wyoming's Workforce Development Training Fund: Does Your Business Qualify?, Wyoming Department of Employment, September 2001.

⁵Fiscal year 1998 data are excluded because they include only one contract with four trainees.

⁶Workforce Development Training Fund administrators verify employment of training participants by requiring employers to submit a list of Social Security numbers and associated hourly wage rates on trainees who were retained for 90 days after training. This is a separate verification process than the one used by Research & Planning.

⁷Since the Workforce Development Training Fund is ongoing, employers may have received grants in these counties at the time of publication.

⁸Demographics for the Workforce Development Training Fund participants are derived from the Wyoming Driver's License Database. Some of the demographics are imputed. For information on the imputation process see Tony Glover, "Enhancing the Quality of Wage Records for Analysis Through Imputation: Part One," Wyoming Labor Force Trends, April 2001, pp. 9-12 and Tony Glover, "Enhancing the Quality of Wage Records for Analysis Through Imputation: Part Two," Wyoming Labor Force Trends, June 2001, pp. 1-6.

⁹This is also known as the Quarterly UI/Workers' Compensation Summary Reports, form WYO056.

¹⁰Other reasons for missing participants in Wage Records include death (three of these individuals were listed as deceased on the Social Security Death Index with death dates prior to the start of the WDTF), withdrawing from the labor market to care for children or parents, moving caused by a spousal relocation, joining the military, or going to work for an employer that is not covered by Unemployment Insurance.

¹¹Alfrieda Gonzales, Strategic Plan Vision Statement, Wyoming Workforce Development Council, June 2001.

¹²Alfrieda Gonzales, Goals of the Wyoming Workforce Development System, Wyoming Workforce Development Council, June 2001.

¹³Earl Babbie, The Basics of Social Research, 2002.

¹⁴See Research & Planning’s website at
< http://LMI.state.wy.us/eds2000/toc001.htm >.

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