Cost-Benefits of Career Development Interventions

Cost-Benefits of Career Development Interventions: Improving the Use A Policy Perspective

Juliette N. Lester United States

For the Second International Symposium on Career Development and Public Policy, 17 countries were asked to respond to five issues including the following:

“For your country, analyze the costs-benefits of career development interventions.

Indicate the degree to which your country differentiates career services such as occupational information, career education, career counseling and job placement as well as the modes by which these services are delivered (e.g., community, classroom, telephone, group, individual, Internet). Also, reflect on possibilities for maximizing and demonstrating the cost-effectiveness of career services (e.g., using technology to complement traditional delivery modes and increase access).”

Defining Policy and Cost-Benefit Analysis

First, to clarify cost-benefit analysis what are some common terms for policy, policy analysis and evaluation?

What are the components of policies? Austin Ranney, a political scientist, described them as:

• A particular object or set of objects -- some designated part of the environment (an aspect of the society or physical world) that is to be affected;

• A desired course of events -- a particular sequence of behavior desired in the particular object or set of objects;

• A selected line of action -- a particular set of actions chosen to bring about the desired course of events; in other words, not merely whatever the society happens to be doing toward the set of objects at the moment, but a deliberate selection of one line of action from among several possible lines;

• A declaration of intent -- some statement by the policy makers, whether broadcast publicly to all who will listen, or communicated secretly to a special few, on what they intend to do, how, and why;

• An implementation of intent -- the actions actually undertaken vis-a-vis the particular set of objects in pursuance of the choices and declaration.

1 Second, What are the issues in policy analysis?

• What choices are made and why?

• Who benefits and who loses?

• What difference does money make?

• What is the impact of public policy?

• How shall policies be evaluated?

Third, How can policy be evaluated?

• Are the goals pursued by the policy desirable social ends?

• Do the policies accomplish the stated goals?

• Are there measurable results?

If public policies are said to eliminate poverty or to provide jobs, for example, it is not only whether the particular policy actually accomplishes its goal, but also more effectively and at less cost than would alternate policies. By this standard, policy evaluation is increasingly dependent on measurement.

Cost-benefit analysis attempts to estimate the costs of each policy option, including as many unanticipated costs as can be identified, and to sum up the benefits of each policy. Decision makers (policymakers) then use the results in the choice of alternatives.

Themes In Common Among Countries

Within that framework, the chart that emerges from the countries’ papers regarding cost-benefit analysis is almost a blank, ready for the researcher to complete in many formats. Countries lacked a common definition of cost-benefit analysis and, therefore, expressed a range of views regarding the influence of this form of evaluation. Substitution for cost-benefit analysis included quality outcomes, both quantitative and qualitative.

Major themes across countries do, however, emerge regardless of the lack of cost- benefit analyses. First, national support for career development is considered a worthy investment for countries in good economic times and bad. Second, the way people prepare for a career and navigate transitions throughout their career is changing. Countries tell us that individuals need to be taught career skills that empower them to locate and process information and to make good choices. When such initiatives are supported by public policy, whether national, provincial, state or local, they seemingly

2 have an even wider reach. They help individual citizens and countries believe they may offer long-term economic benefits for the country as a whole.

What is missing among the countries is a clear view of how to measure the career development services for individuals that promote this economic good for the citizens of the country. The Canadian team, for example, “redefined” the cost-benefit issue as follows:

• The issue is asking that we select certain kinds of services and modes of delivery;

• How do we decide what will be offered to students and clients?

• How do we assess whether what we are offering is worth the investment?

In contrast, in the United Kingdom the recognition of public funds being spent results in a rigorous evaluation of cost-benefits to the taxpayer and to society as a whole. “The rationale behind the provision of publicly funded career guidance is that it is not merely a worthy private good but also a public good.” Finland raises the concern of the lack of well-functioning indicators in the evaluation of quality of results in costs and benefits as a common problem. “The greatest lack is of quality criteria.” Finland also cites the need for long-term follow-up studies. Germany answers the question about how to improve benefits and justify the costs by suggesting that we forget about “proof.” “Proof is a fictitious concept of the fading mechanical industrial era.” Just like we keep telling our clients: We’ll have to take our bets on the basis of probabilities.” For Denmark “cost-benefit issues are out of scope and not yet on the agenda.” But Denmark believes they ought to be. Ireland also cites the need for measurement of impact and cost effectiveness of specific guidance interventions. Despite Hungary’s progress in career development, most of the services are not independent, but part of training and thus are difficult to quantify.

Reforms Must Have Strong Roots

The challenge for those of us who are engaged in providing career development policy and practice is to make sure our efforts take root and spread. With this in mind, forums like the Second International Symposium on Career Development and Public Policy heighten our awareness about spreading the word about what works in introducing cost-benefit analysis for the types of career development services that are chosen by individual countries.

Among the common ideas that countries suggest are some basic steps for improving cost-benefit analysis and outcomes research:

 Show how the analysis can meet local needs;

3  Build broad based support by inviting active participation of policymakers and keeping them well informed;

 Increase public and professional understanding of the evaluation activities;

 Provide assistance and training for possible integration of the outcomes research;

 Integrate the outcomes into ongoing or future legislation, policy and program plans at various governmental levels;

 Link the analysis and evaluation with appropriate new trends and innovations in education and training.

The American Economic Association Annual Meeting in 2001 drew many economists “crowded into conference rooms to discuss statistical studies on obesity, pawn shops and the impact of computers in classrooms.” A younger breed of economists is applying mathematical models in economic theories “to a range of social problems, rather than the more familiar terrain of finance and markets.” (Wall Street Journal, April 27, 2001) As economists help shape the debate of a variety of issues outside the traditional sphere of economics, especially as it relates to schools and school reform, it would be helpful to advance the topic of early career guidance effect on youth over time and its impact on a country’s employment and unemployment data. In the United States, the Labor Department and the Bureau of Labor Statistics only began measuring the unemployment rate in 1948. Obviously, with computers and the Internet there is a great deal more information on social trends for economists. Education policymakers are looking for ways to hold schools more accountable for their students. A career guidance and career development strategy should be a part of that agenda.

Emerging Issues for Cost-Benefit Analysis

The use of technology for career development services raises several issues related to cost-benefit analysis. Country papers from Canada, Israel, the United Kingdom, New Zealand, Australia and the United States emphasize changes to be considered for cost-benefit studies.

Five themes emerge:

1. How technology is changing the practice of career development, i.e., changing the roles of client and practitioner; 2. How technology has raised the issue of ethical standards for Web counseling; 3. How technology has brought about a change in labor exchange systems through use of the Internet and virtual one-stop centers for job seekers and employers;

4 4. How advancing information technology is reshaping worldwide labor markets, e.g., high tech jobs; and 5. How using on-line services for self-assessment offers the potential to save time and money. Another challenge, however, is that many of the people currently served by career development practitioners are not yet “wired” to the Web. Even in the United States, about half of all homes do not have Internet access. As the use of the Net increases, the “digital divide” between the “haves and have-nots” grows wider and harder to bridge.

Defining the Role of the Providers: Barriers to Cooperation

Politicians and policymakers and career development practitioners may view cost- benefit analysis quite differently. Policymakers may view practitioners as follows: (1) wanting more for their programs needs without acknowledging competing social priorities; (2) promoting their own economic and professional interests without proposing what policymakers view is needed for the students or adults; and (3) in not understanding the necessity of building coalitions with other educators and non- educational groups to advance social goals.

Career development practitioners, on the other hand, have concerns about the program’s quality and delivery in a context of new technology, new statutes, new politics, new financial patterns, new consolidation and new reduction of budgets.

Since countries were also asked to address the question of what research base exists to support outcomes as quality indicators, the two issues share a common concern and need by both policymakers and practitioners. Whatever the term may be, there is shared language, criteria and benchmarks to be supported by government and non- government organizations (NGO) and the public. The policymaker, in trying to set a value on a program, a procedure, or a plan of action, is seeking an assessment, an evaluation or an appraisal – a cost-benefit analysis. Likewise, the practitioner is also searching for qualitative and quantitative outcomes and setting a value on the program, the procedure, the plan of action, and an appraisal – a cost-benefit analysis.

Policy, Practice and Research: Closing the Gap

A brief review of three public policy components, policy, practice and research, serves as a framework for discussing cost-benefit analysis. Policy is often described in legislative terms. Practice for a government agency or a non-government organization (NGO) may be implementation, often regulated. Research may be evaluation, assessment or cost-benefit analysis. What is essential is the closing of the gap for these three issues, policy, practice and research or evaluation (PPR). Canada also introduces the theme of a closed “loop” in its country paper.

An education program in the United States serves to illustrate PPR. In 1976, Congress reauthorized the Vocational Education Law (policy) and mandated that the U.S. Department of Education develop regulations to implement the program (practice). The

5 law also mandated that the Department evaluate the impact of the law through a National Assessment of Vocational Education (NAVE) (research) to be submitted to the Congress in three years. The 1976 law had set-asides for the disadvantaged and handicapped populations; since more financial resources were to be made available for these groups, a cost-benefit analysis became part of the assessment.

By 1984, when the Vocational Education Law was reauthorized, the Congress relied heavily on the results of the NAVE study for the subsequent funding formula. Also involved were the stakeholders or interest groups who not only testified, but were partners in all stages of the program – developing the policy (the law), describing the practice (regulation) and serving as consultants and, sometimes, contractors for the assessment studies (research). In fact, the process of policy development, program implementation and assessment has continued through to the 1990 and 1998 laws.

This brief illustration highlights the role of national leadership in three critical stages to sustain programs – development, implementation (including funding) and evaluation – thereby closing the gap.

Conclusion

For countries to close the gap and make the case for national policies for career development services, there are several questions related to cost-benefits analysis. First, what assessment studies are in countries in either labor or educational areas, for which career guidance and delivery should or could become a part? Second, to what extent can countries use ongoing impact studies or outcome studies to make the case for career guidance? Third, who pays for the studies? Fourth, are the stakeholders informed about the studies? Fifth, should cost-benefit analysis prevail or other forms of research?

In summary, countries desire to have career development services addressed for their cost-benefits. In order to influence policymakers, there is a need to consider the quality of the outcomes sought by the policymakers. It is also of benefit to both policymakers and practitioners to overcome fragmentation and to consider broader issues to legitimatize the cost-benefits of career development services and programs.

6 TOWARD WIDESPREAD PRACTICE.

GENERATE COMMON NEEDS FOR COST-BENEFIT ANALYSIS.

WHAT COUNTRIES HAVE A UNIQUE PERSPECTIVE?: CHALLENGE WITH RESPECT FOR THE ISSUES

DIRECTIONS: WHAT DIRECTIONS ARE UNDERWAY IN OTHER COUNTRIES