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JUL-03-2000 12:26
OMB DEP DIR MGMI
202 395 6974 P.03/10
Job Reduction /Earnings Gain revisions
Measure earnings gain at both six and 12 months;
Adjust the earnings gain for the cost of living in each
State using the HUD fair market rent amount;
Measure only full quarters' earnings; or
Allow administrative data on a voluntary basis as a
source of earnings.
P-SH2
Response: We have not made any change to the earnings gain
measure. While a separate measure would provide a discrete focus
and reward, we believe that performance in earnings gain is
directly linked to job retention in the work world. Research in
this area has shown a correlation between persistent work force
attachment and earnings. Therefore, we believe that the link
between job retention and earnings gain should be maintained in
order to focus attention and resources on both. We also believe
that de-linking these measures could create perverse incentives
for States, e.g., to focus on placement and retention of
recipients in any job without regard to the quality of the job or
to "cream" in order to show larger earnings gains.
Also, creating a separate earnings gain measure would result in
fewer bonus dollars for any one work measure. In addition,
increasing the weighting of the earnings gain measure would not
realistically reflect the dependence of earnings gain on job
retention. We did not want to measure earnings gain at both six
and twelve months for essentially the same reasons we did not
141
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"ocrText": "JUL-03-2000 12:26\nOMB DEP DIR MGMI\n202 395 6974 P.03/10\nJob Reduction /Earnings Gain revisions\nMeasure earnings gain at both six and 12 months;\nAdjust the earnings gain for the cost of living in each\nState using the HUD fair market rent amount;\nMeasure only full quarters' earnings; or\nAllow administrative data on a voluntary basis as a\nsource of earnings.\nP-SH2\nResponse: We have not made any change to the earnings gain\nmeasure. While a separate measure would provide a discrete focus\nand reward, we believe that performance in earnings gain is\ndirectly linked to job retention in the work world. Research in\nthis area has shown a correlation between persistent work force\nattachment and earnings. Therefore, we believe that the link\nbetween job retention and earnings gain should be maintained in\norder to focus attention and resources on both. We also believe\nthat de-linking these measures could create perverse incentives\nfor States, e.g., to focus on placement and retention of\nrecipients in any job without regard to the quality of the job or\nto \"cream\" in order to show larger earnings gains.\nAlso, creating a separate earnings gain measure would result in\nfewer bonus dollars for any one work measure. In addition,\nincreasing the weighting of the earnings gain measure would not\nrealistically reflect the dependence of earnings gain on job\nretention. We did not want to measure earnings gain at both six\nand twelve months for essentially the same reasons we did not\n141"
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