Wage subsidies for needy job-seekers and their effect on individual labour market outcomes after the German reforms

Sarah Bernhard (), Hermann Gartner and Gesine Stephan

No 200821, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "In Germany, since 2005 needy job-seekers without access to earnings-related and insurance-paid 'unemployment benefit I' are entitled to means-tested and tax-funded 'unemployment benefit II'. Several active labour market programmes support the integration of these needy job-seekers into the labour market. Our paper estimates the average effect of targeted wage subsidies - paid to employers for a limited period of time - on the subsequent labour market prospects of participating needy job-seekers. We apply propensity score matching to compare participants with a group of similar non-participants. The results show that wage subsidies had in fact large and significant favourable effects: 20 months after taking up a subsidised job, the share of persons in regular employment is nearly 40 percentage points higher across participants. Estimated effects on the shares not unemployed and the share no longer receiving 'unemployment benefit II' are slightly smaller." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; Eingliederungszuschuss; Erfolgskontrolle; Arbeitslosengeld II-Empfänger; Arbeitsmarktchancen (search for similar items in EconPapers)
JEL-codes: J64 J65 J68 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2008
New Economics Papers: this item is included in nep-eec, nep-hap and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (41)

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Related works:
Working Paper: Wage Subsidies for Needy Job-Seekers and Their Effect on Individual Labour Market Outcomes after the German Reforms (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:200821

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