Trade Adjustment Assistance Program: Helping Workers Affected by Globalization

Globalization has intensified competition throughout the U.S. economy. While the net benefits of foreign trade are large—everyone benefits from the availability of lower-priced goods—there is a downside. Some U.S. workers experience unemployment and earnings losses resulting from plant closings and jobs being sent overseas.

The Trade Adjustment Assistance (TAA) program provides aid to workers who lose their jobs or whose hours of work and wages are reduced as a result of increased imports. Workers may be eligible for training, job search and relocation allowances, income support, and other reemployment services.

Social Policy Research and Mathematica are evaluating the TAA program for the U.S. Department of Labor, Employment and Training Administration. This five-year study addresses a full range of questions regarding the operation and impacts of the program after the passage of the Trade Act of 2002 and includes the following components:

• Initial implementation analysis to provide quick feedback, based on site visits to 13 states and local areas
  
• Process study examining how the program operates (based on five rounds of site visits to states and local areas as well as a survey of all local areas)
  
• Impact study on participants’ employment-related outcomes, overall and for key worker subgroups
  
• Benefit-cost analysis 

The impact study is based on a comparison group design, in which samples of TAA participants are matched to unemployment insurance claimants not eligible for TAA (but otherwise similar) using propensity scoring methods. The samples are to be selected using administrative records data from 25 randomly selected states. The administrative records sample will contain 36,000 workers in the TAA group and 72,000 workers in the comparison group. Telephone surveys with a random subset of the sample will occur at baseline, 15 months, and 30 months.

The study results will be published in a series of reports starting in 2010.

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