Temporary Work as an Active Labor Market Policy: Evaluating an Innovative Program for Disadvantaged Youths

Abstract

While high rates of youth unemployment are a severe problem in most European countries, the program evaluation literature shows that disadvantaged youths constitute a group that is particularly difficult to assist effectively. As innovative measures are thus needed, we evaluate a German pilot program that targets low-skilled young unemployed and combines three components: a) individual coaching, b) classroom training and c) temporary work. Using an ex-post quasi-randomization approach, our analysis shows that the program has a positive impact on the post-program employment probability of participants.