A surreal staircase made of books leads to a bright cityscape, symbolizing career opportunities through education.

Laid Off? Unlock Your Potential: Retraining Programs That Actually Pay Off

Lena Kashyap in Business & Economy July 2025 • 4 min read.

"New research reveals how further education during unemployment can lead to significant earnings gains, especially for those switching to healthcare."

In today's rapidly evolving job market, the fear of being laid off looms large. The shift away from middle-skill jobs, coupled with economic downturns, leaves many workers searching for a way to stay relevant and secure. While the prospect of unemployment can be daunting, it also presents a unique opportunity: the chance to reskill and reinvent yourself for a brighter future.

For years, economists and policymakers have advocated for further education as a means of combating unemployment and mitigating its harsh economic and social consequences. But how effective is retraining, really? Much of the existing evidence focuses on specific government-sponsored training programs, offering a limited view of the broader potential of further education.

Now, groundbreaking research is shedding light on the true impact of retraining on unemployed workers. By analyzing high-quality data from the state of Ohio, economists Pauline Leung and Zhuan Pei have uncovered compelling evidence that further education, broadly defined as enrollment in postsecondary institutions, can lead to significant earnings gains and open doors to new career paths.

Retraining Pays Off: The Ohio Study's Surprising Findings

A surreal staircase made of books leads to a bright cityscape, symbolizing career opportunities through education.

Leung and Pei's research, detailed in their December 2023 paper, takes a comprehensive look at the effectiveness of retraining for unemployed workers. Unlike previous studies that focus on narrow training programs, this research examines the impact of enrollment in postsecondary institutions, including community colleges and technical centers.

Using a sophisticated matching method, the researchers compared the labor market outcomes of unemployed workers who pursued further education (enrollees) with those who did not (non-enrollees). Their analysis revealed a compelling trend: while enrollees initially experienced depressed earnings during the first two years of schooling, they later saw significant gains.

Earnings Boost: Enrollees experienced earnings gains of approximately six percent three to four years after enrolling.
Industry Matters: The most substantial earnings effects were observed among workers who switched industries, especially those transitioning to healthcare.
Long-Term Impact: Following a subset of workers for a longer period, the researchers found that the retraining effect persisted and widened to 13 percent at the end of a ten-year horizon.

These findings suggest that retraining, when strategically chosen, can provide a powerful boost to the career prospects of unemployed workers. But what makes these programs so effective, and how can you maximize your chances of success?

Turning Unemployment into Opportunity: Your Next Steps

The research is clear: strategic retraining can be a game-changer for unemployed workers. By carefully considering your skills, interests, and the demands of the modern job market, you can leverage further education to unlock your full potential and secure a brighter future. Explore the resources available in your community, connect with career counselors, and take the first step towards a more rewarding career path. Your next chapter starts now.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: https://doi.org/10.48550/arXiv.2312.17123,

Title: Further Education During Unemployment

Subject: econ.gn q-fin.ec

Authors: Pauline Leung, Zhuan Pei

Published: 28-12-2023

Everything You Need To Know

How can further education help unemployed workers?

Research from Pauline Leung and Zhuan Pei suggests that further education, specifically enrollment in postsecondary institutions, can lead to substantial earnings gains for unemployed workers. While there may be an initial period of reduced earnings during schooling, individuals can experience significant earnings growth in the years following enrollment. This is especially true for those who strategically choose retraining programs aligned with high-demand industries.

What specific sector shows the most promise for unemployed workers looking to reskill?

The research conducted by Pauline Leung and Zhuan Pei indicates that the healthcare sector offers significant opportunities for unemployed workers. Individuals who transition into healthcare through retraining programs experience the most substantial earnings gains compared to those entering other industries. This highlights the importance of considering industry-specific demands when choosing a retraining path.

How long does it take to see the financial benefits of retraining programs, according to the Ohio study?

According to the study by Pauline Leung and Zhuan Pei, unemployed workers who enroll in further education may initially experience depressed earnings for the first two years. However, after three to four years, enrollees typically begin to see earnings gains of approximately six percent. Furthermore, a longer-term analysis reveals that this retraining effect can widen to 13 percent over a ten-year period, demonstrating the long-term financial benefits of strategic retraining.

What type of retraining programs were examined in the study by Pauline Leung and Zhuan Pei, and how does that differ from previous research?

Pauline Leung and Zhuan Pei's research examined the impact of enrollment in postsecondary institutions, including community colleges and technical centers, on unemployed workers' earnings. This approach differs from previous studies that often focused on specific government-sponsored training programs. By taking a broader view of further education, Leung and Pei's study provides a more comprehensive understanding of the potential benefits of retraining for unemployed individuals. This is important because it demonstrates value of education in general, and is not limited to a specific program.

What are the long-term implications of retraining for unemployed workers, based on the research?

The research by Pauline Leung and Zhuan Pei suggests that strategic retraining can have a lasting impact on the career prospects of unemployed workers. While initial earnings may be depressed during the training period, the long-term gains can be substantial. Following a subset of workers for a longer period, the researchers found that the retraining effect persisted and widened to 13 percent at the end of a ten-year horizon. This highlights the importance of viewing retraining as a long-term investment in one's future career and financial security. It underscores the idea that retraining is not just a quick fix for unemployment, but a strategic move that can lead to sustained career growth and improved earnings potential.