Pay for Success Workforce Development Strategies

Policy or Initiative Description

State governments should implement Pay for Success strategies to expand career and technical education for low-skilled workers. Pay for Success is a contractual arrangement that ties payment for delivery of services to specific, measurable outcomes. This public policy tool may be used to test new workforce development programs guided by predetermined outcomes for a target population or a community, such as sustained employment or demonstrable wage increases for participants. Because payment is contingent on achievement of the intended outcome, taxpayers do not bear the risk of paying for programs or services that may not be effective.


The Northern Virginia Team Independence Initiative, a partnership between SkillSource, Fairfax County Division for Family Services (DFS), and social service and justice organizations across Northern Virginia has a pay for success opportunity youth project which aims to "increase the number of young adults engaged in education and employment programs and to improve skills development and employment outcomes for economically disadvantaged foster care and justice-involved young adults using the Northern Virginia Workforce System."


Bonds, Milliken Jeanne. “Pay for Success: How Emerging Finance Tools Are Supporting Workforce Development.” Federal Reserve Bank of Richmond. 2019.



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