The Youth Entitlement Demonstration: Subsidized Employment with a Schooling Requirement

Abstract

The YIEPP offered a minimum wage job, part-time during the school year and full-time during the summer, to 16-19-year-olds from low-income households who had not as yet graduated from high school and who were enrolled in school. Our finding of large positive employment effects for this population is strong evidence that the unemployment of these youths is largely involuntary, due to demand deficiency at the minimum wage. We also find small positive school enrollment effects, and an employment displacement rate of 31.6 percent-that is, 31.6 percent of subsidized employment would have been available for the target population even in the absence of the program.