Are active labour market policies effective in activating and integrating low-skilled individuals? An international comparison

Abstract

This paper examines the effectiveness of active labour market policies (ALMPs) in improving labour market outcomes, especially of low-skilled individuals, by means of a pooled crosscountry and time series database for 31 advanced countries during the period 1985-2010. The analysis includes aspects of the delivery system to see how the performance of ALMPs is affected by different implementation characteristics. Among the notable results, the paper finds that ALMPs matter at the aggregate level, but mostly through an appropriate management and implementation. In this regard, sufficient allocation of resources to programme administration and policy continuity appear to be particularly important. Moreover, start-up incentives and measures aimed at vulnerable populations are more effective than other ALMPs in terms of reducing unemployment and increasing employment. Interestingly, the positive effects of these policies seem to be particularly beneficial for the low skilled.

The Impact on Employment of Active Labour Market Policies: An Evaluation of Public Employment Services (PES) in Kosovo

“…Despite the deviation and some negative effects identified (Escudero 2018;Mare 2005) the significant positive effects in the form of employment, preserving and improving skills, competitiveness, productivity and involvement in the labour market convincingly justify the use of the ALMP measures. However, there is no complete consensus or clear effectiveness evidence of the ALMP specific measures and the impact of these policies on labour market performance.…”

Impact of Active Labour Market Policy Programs on Employment in the EU During the Crisis

“…Besides, there are few recent macroeconomics studies that analysed the effects of ALMP programs, except the research of Escudero (2018). In his research, Bredgaard (2015) even argues that a database that would support research on how ALMP programs actually work is not yet available.…”

“…Conversely, Direct Job Creation had a negative effect on the unemployment rate and the Supported Employment program did not show a statistically significant difference. Escudero (2018) examined the effectiveness of ALMPs in improving labour market outcomes, especially of low-skilled individuals, by means of a pooled cross-country and time series database for 31 advanced countries during the period 1985-2010. The analysis included aspects of the delivery system to see how the performance of ALMPs is affected by different implementation characteristics.…”

“…(Estevão, 2003), Labour Policies to Raise Employment (Estevão, 2007), Are active labour market policies effective in activating and integrating low-skilled individuals? An international comparison (Escudero, 2018) 3 Methods…”

Minimum income schemes in Europe: is there a trade-off with activation policies?

“…Due to high heterogeneity across countries in the approaches to activation as documented by Escudero (2015) and to the specific research question under analysis, this work focuses on the aggregate value given by countries' public expenditure on ALMPs as a percentage of GDP. Martin John (2014) extensively documented the evidence of an increase in public expenditure related to active labor market policies (ALMPs) in European countries in the last decades, also in relation to their effectiveness.…”