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Research Summary This study argues that employment programs for individuals exiting prison can benefit society even if they do not directly reduce recidivism, by helping to identify quickly and efficiently those desisters who are ready to work. We make the following basic claims: Individuals exiting prison have poor work experience, low levels of education, and generally qualify for only low‐skill, entry‐level jobs. Moreover, the majority will recidivate within 3 years. Employment training programs are designed to ameliorate these deficits, but to date, they have demonstrated only limited potential to improve employment prospects and recidivism risk. Despite a poor track record for employment‐based reentry programming, a substantial minority of individuals exiting prison has desisted from crime and has the capacity to maintain stable employment. Growing evidence suggests that this desistance process occurs quickly—almost instantaneously—and is driven by decisions on the part of the individual to change. This type of instantaneous, agent‐based change is difficult to predict using static risk prediction tools. As a result, desistance is fundamentally unobservable to employers and others who might wish to identify good employees from the group of people who have criminal history records. In lieu of additional information, one's true desistance state will only be revealed through time. This situation is a classic case of a market with asymmetric information. Although growing numbers of employers refuse to hire individuals with criminal history records, some are in fact willing to hire from this pool of workers. More might be willing to do so if they could reliably identify desisters. The current legal environment is increasingly hostile to across‐the‐board bans on hiring individuals with criminal history records without documentation of business necessity. Program participation, completion, and endorsement from a training organization can provide a reliable signal to employers that a given individual has desisted and is prepared to be a productive employee, as long as the cost to program completion is high for those who have not desisted, and low for those who have desisted. Effective signals must be voluntary. Requiring program completion, or graduating all participants, renders the signal useless. Existing evidence demonstrates that program participants (or program completers) do in fact recidivate less often and have better employment outcomes than program nonparticipants (or program dropouts), even in cases where the program does not seem to “work” in a causal sense. This evidence can be taken to suggest that program completion provides valuable information—a signal—to the labor market. Limited anecdotal evidence suggests that some employers—among those willing to hire individuals with a criminal history record—may already be using completion of employment training programs to identify “good employees” among the pool of low‐skill labor. The development of effective signals could create a net gain to society if, ...

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