Labour Market Policies Research Articles

Nudging increases take‐up of employment services: Evidence from a large field experiment

AbstractWhen people lose their job, labor market programs help them get back to work. But administrative burdens can hinder enrollment in such programs. We report results from a mixed‐method project to increase enrollment in employment services during the first 3 months of the COVID‐19 pandemic. First, we interviewed jobseekers and frontline staff to uncover administrative burdens. Second we worked with staff to co‐design a behavioral “nudge” intervention. Finally, in a large field experiment (N = 14,008), we evaluate the impact of this intervention on participation in employment services. We present two main findings. First, reducing administrative burden triples enrollment in the program within the first 30 days. Second, we test two motivational frames—one emphasizing social norms, another using checklist messaging. We find that message framing drives engagement with communications, such as email open rates and website click‐throughs. However, framing generates no statistically significant difference in enrollment rates. Our results demonstrate the potential for applied behavioral science to improve implementation of labor market policy. We also contribute to current debates about the effectiveness of nudging to increase take‐up of public services.

Mapping job fitness and skill coherence into wages: an economic complexity analysis

Leveraging the discrete skill and knowledge worker requirements of each occupation provided by O*NET, our empirical approach employs network-based tools from the Economic Complexity framework to characterize the US occupational network. This approach provides insights into the interplay between wages and the complexity or relatedness of the skill sets within each occupation, complementing conventional human capital frameworks. Our empirical strategy is threefold. First, we construct the Job and Skill Progression Networks, where nodes represent jobs (skills) and a link between two jobs (skills) indicates statistically significant co-occurrence of skills required to carry out those two jobs, that can be useful tools to identify job-switching paths and skill complementarities Second, by harnessing the Fitness and Complexity algorithm, we define a data-driven skill-based complexity measure of jobs that positively maps, but with interesting deviations, into wages and in the bottom–up and broad abstract/manual and routine/non-routine job characterisations, however providing a continuous and endogenous metric to assess the degree of complexity of each occupational skill-set. Third, building on relatedness and corporate coherence metrics, we introduce a measure of each job’s skill coherence, that negatively maps into wages. Our findings may inform policymakers and employers on designing more effective labour market policies and training schemes, that, rather than fostering hyper-specialization, should favor the acquisition of complex and “uncoherent” skill sets, enabling workers to more easily move throughout the job and skill progression networks and make informed career choices decisions while unlocking higher wage opportunities.

The labour market and tax policy drivers of self‐employment: New evidence from Europe

The labour market and tax policy drivers of self‐employment: New evidence from Europe

Link Between Political and Economic Stability: A Case Study of Pakistan

Present research aims at investigating the relationship between political and economic stability in Pakistan. Using secondary data over the period of 1987 to 2022, ARDL bound testing technique is employed to obtain short-run and long-run estimates of the regression model. It is found that political stability and economic stability have a positive and significant relationship. The study also establishes that increase in labor force, trade openness and real discount rate help to achieve economic stability while government expenditure negatively impact economic stability. Based on these conclusions, study proposes important policy recommendations including prudent fiscal management, labor market policies for workforce growth, efforts to promote political stability, cautious monetary policy management, and continued promotion of trade openness to foster stability in economic growth.

Labour market segmentation and the gender wage gap in Spain

PurposeThe purpose of this study is to analyse the gender wage gap (GWG) in Spain adopting a labour market segmentation approach. Once we obtain the different labour segments (or idiosyncratic labour markets), we are able to decompose the GWG into its observed and unobserved heterogeneity components.Design/methodology/approachWe use the data from the Continuous Sample of Working Lives for the year 2021 (matched employer–employee [EE] data). Contingency tables and clustering techniques are applied to employment data to identify idiosyncratic labour markets where men and/or women of different ages tend to match/associate with different sectors of activity and occupation groups. Once this “heatmap” of labour associations is known, we can analyse its hottest areas (the idiosyncratic labour markets) from the perspective of wage discrimination by gender (Oaxaca-Blinder model).FindingsIn Spain, in general, men are paid more than women, and this is not always justified by their respective attributes. Among our results, the fact stands out that women tend to move to those idiosyncratic markets (biclusters) where the GWG (in favour of men) is smaller.Research limitations/implicationsIt has not been possible to obtain remuneration data by job-placement, but an annual EE relationship is used. Future research should attempt to analyse the GWG across the wage distribution in the different idiosyncratic markets.Practical implicationsOur combination of methodologies can be adapted to other economies and variables and provides detailed information on the labour-matching process and gender wage discrimination in segmented labour markets.Social implicationsOur contribution is very important for labour market policies, trying to reduce unfair inequalities.Originality/valueThe study of the GWG from a novel labour segmentation perspective can be interesting for other researchers, institutions and policy makers.

A Measure That Really Works? Impact Evaluation of the Contribution for Self-Employment as a Tool of Active Labour Market Policy in Slovakia

Unemployment presents a significant challenge requiring attention not only in developing countries but also in economically developed ones. Active labour market policies offer a potential solution to address this issue. This study focuses on assessing the impact of the intervention called Contribution for Self-employment provided under the Act on Employment Services No. 5/2004 Coll in the Slovak Republic. This financial support is extended voluntarily to unemployed individuals seeking jobs and aims to partially defray the expenses associated with launching business ventures. The primary objective of this research is to quantify the effectiveness of the Contribution for Self-employment in enhancing the employment of its recipients, thereby gauging its efficacy in reducing unemployment. The evaluation employs a counterfactual impact assessment methodology, utilising propensity score matching for analysis, with propensity score estimated by the logistic regression. Data from the registry of jobseekers maintained by the Central Labour Office of Social Affairs and Family in Slovakia are utilised in this analysis. This study’s findings indicate a favourable impact of the contribution on the employment of its participants compared to the comparable non-participants. Consequently, this intervention emerges as a viable mechanism for supporting entrepreneurship and mitigating unemployment in Slovakia.

Knowledge Utilisation Analysis: measuring the utilisation of knowledge sources in policy decisions

Background: Understanding knowledge utilisation in policymaking is a core task for the social and political sciences. However, limitations and biases abound in commonplace approaches to measuring such use. Consequently, we have little systematic evidence of the extent to which knowledge sources are used in policy decisions. Aims and objectives: This article discusses existing approaches to studying knowledge utilisation and introduces the analytical approach, Knowledge Utilisation Analysis (KUA), which harnesses the growing quantities of documents available online. Methods: KUA offers a four-step procedure that enables researchers to systematically compare policy documents with knowledge sources and measure the degree to which policy decisions follow or contradict relevant knowledge. Findings: The article showcases KUA in a study of Danish primary education and active labour market policies from 2016 to 2021. By analysing 1,159 documents, KUA is leveraged to study levels of knowledge utilisation across policy areas, research methods, and provider types. Discussion and conclusion: KUA contributes methodological innovation to measuring knowledge utilisation by systematically matching knowledge sources with policy decisions. KUA can, thereby, enhance empirical research on the relationship between knowledge and policy.

A Comprehensive Review of the Three Main Topic Modeling Algorithms and Challenges in Albanian Employability Skills

Today’s jobseekers face many obstacles while trying to find a career that aligns with their interests, employability soft skills, and professional experience. In Albania, jobseekers frequently initiate their job search by actively exploring job vacancies listed on various online job portals. The analysis of job vacancies posted online provides an added advantage to the labour market actors compared to traditional survey-based analyses. This is because it enables a faster analytical process, promotes decision-making based on accurate data, and should be carefully considered by every country when formulating their Labor Market Policies. Since the data posted online are unlabelled, it has been proven that the potential of unsupervised learning techniques, more precisely the Topic Modelling algorithms, is outstanding when applied to analysing job vacancies, mainly with regard to assessing employability soft skills. Algorithms in topic modelling are essential for uncovering hidden patterns in texts, facilitating the extraction of important data, generating document summaries, and enhancing content comprehension. This paper analyses and compares the three primary methodologies and algorithms used in topic modelling, which can be applied to analyse employability soft-skills: Latent Semantic Analysis (LSA), Latent Dirichlet Allocation (LDA), and BERTopic. At the end of the paper, conclusions are drawn regarding superior performance and optimal algorithm applicability, challenges, and limitations through a review of studies conducted in the Albanian job market.

Framework for Examining the Correlation Between Trade Liberalization and Employment in Nigeria

This research examines the relationship between trade liberalization and employment in Nigeria using a retrospective research approach. The study considers variables such as the employment rate, trade openness index, foreign direct investment, and currency exchange rate. The analytical framework combines classical linear regression and Auto Regressive Distributed Lag (ARDL) models to capture both short-term and long-term dynamics. Diagnostic tests, including descriptive statistics, Augmented Dickey-Fuller (ADF) test, Perron Unit Root Test, ARDL-Bound test, and Error Correction Model (ECM)-ARDL test, are conducted to analyze the collected data. The study utilizes secondary data from the statistical bulletin of the Central Bank of Nigeria (2018) covering the period from 1985 to 2018. The findings of the study are mixed. The error correction estimates indicate a negative relationship between the trade openness index and the employment rate. On the other hand, foreign direct investment shows a negative relationship with employment rate, but this relationship is not statistically significant. The exchange rate demonstrates a positive and significant correlation with the employment rate. It was recommended that, Diversifying Nigeria's economy by promoting domestic industries like agriculture, manufacturing, and services to create job opportunities and reduce import dependence. Implement effective labor market policies including job training, worker protections, and competitive labor market measures to mitigate negative impacts of trade liberalization on employment. Target FDI to sectors with high job creation potential, incentivizing investments, supporting technology transfer, and fostering partnerships for employment growth in Nigeria.

Precariat women’s experiences to undertake an entrepreneurial training program

Women aged over 50 in Australia are becoming increasingly reliant on long-term welfare. Individual characteristics, societal norms, industry practices, and government policy create a multi-factorial, precariat population who have difficulties finding consistent, meaningful employment, live in financial distress, and have poor self-efficacy and mental health. Globally, entrepreneurial intervention programs are touted as an active labor market policy solution, helping people out of welfare into self-employment, and contributing to economic growth. While women and the long-term unemployed tend to struggle in such programs, in comparison, older participants thrive. The study aimed to identify the main factors that shape precariat women’s experiences in undertaking entrepreneurial intervention programs. Interview data collected longitudinally from 39 precariat women revealed four salient themes: the need for achievement as a motivator; self-efficacy and confidence; the negative impact of losing welfare assistance; and the beneficial impact of education and upskilling training. We discuss implications for research and policy.

Active labour market policies in emerging adulthood may act as a protective factor against future depressiveness: an analysis of the long-term trajectories of depressive symptoms in the Northern Swedish Cohort.

Drawing upon the framework of life course epidemiology, this study aligns with research on the mental health consequences of significant social transitions during early adulthood. The focus is on the variation in initial labour market attachment and the development of depressiveness, assuming that a firm attachment is associated with decreasing depressiveness. The baseline investigation of the studied cohort (n = 1,001) took place during their final year of compulsory schooling at age 16. Follow-up surveys were conducted at ages 18, 21, 30, and 43. Depressiveness was measured with a five-item score. Multiple trajectory analysis, incorporating five labour market statuses observed over seven half-year periods from ages 18 to 21, was employed to categorize the cohort into six distinct groups. Among these, 'All-time education,' 'From education to employment,' 'Education and employment,' and 'From employment to education' were considered to demonstrate firm labour market attachment. Meanwhile, 'Active labour market policy' and 'Unemployment' represented less firm attachment. The trajectory of depressive symptoms among the total cohort from age 16 to age 43 exhibited a 'broken stick' pattern, reaching its lowest point at age 21. This pattern was evident in all groups classified as having a firm attachment. A substantial decrease in depressiveness was also observed in the relatively weakly attached 'Active labour market policy' group, whereas no 'broken stick' pattern emerged in the 'Unemployment' group. The disparities in the levels of depressiveness observed at age 21 remained relatively stable across the measurements at ages 30 and 43. The results were as expected, except for the observed improvement in mental health within the 'Active labour market policy' group. Supported labour market attachment during emerging adulthood can enhance mental well-being similarly to regular mainstream attachment. In terms of policy recommendations, the consistently high levels of depressiveness within the 'Unemployment' group underscore the importance of reducing long-term and repeated unemployment in young age. The findings regarding the 'Active labour market policy' provide evidence of the intervention's benefits. While the primary goal of these measures is to create jobs for the unemployed, they also include elements that contribute to participants' mental health.

The Labor Market and Gender during the 20th Century: An Analysis of the Causes of the Feminization of Welfare Policy in Argentina

This article delves into the intricate relationship between the evolution of Argentina’s labor market, particularly the historical inclusion of women, and the contours of contemporary social welfare policies for female recipients. Set against the backdrop of a decades-long crisis in employment and income, especially affecting low-income families and women tasked with caregiving responsibilities, the article posits the hypothesis that the trend of feminization in social welfare policies partly stems from the pauperization of Argentina’s labor market in the latter part of the 20th century and the historically subordinate role of women within patriarchal capitalist societies. Employing an empirical-historical methodology, it scrutinizes the shifts and dynamics of the labor market over the 20th century as well as the features of the welfare policy framework at the beginning of the 21st century. The article is a contribution to Argentina’s labor market and social policy literature and portrays current socio-welfare programs as an adaptation to the employment and income crisis, further entrenching women’s subordinate status within the social fabric.

The politics of piloting. The case of minimum income schemes in European cities

AbstractEU member states have adopted Minimum Income Schemes (MIS) to prevent destitution and ensure a minimum standard of living through means‐tested income support combined with Active Labor Market Policies (ALMPs). However, the effectiveness of MIS has been hindered by limited coverage, low take‐up rates, inadequate cash transfers, strict conditionalities, and the limited impact of ALMPs. Public opinion is polarized, leading to potential policy changes. Pilot projects have emerged as a strategy to address implementation barriers, facilitate evidence‐based policy making, and improve stakeholder relationships. This paper investigates the political conditions under which pilots are promoted and the effects these policy decisions have on scaling up through a qualitative analysis and comparison, using two exemplary cases—B‐MINCOME in Barcelona and Weten Wat Werkt in Utrecht.

Navigating Cross-Sector Partnerships: Innovative Strategies and Challenges for Work Integration Social Enterprises in France

In recent years, ground breaking approaches have emerged to dismantle entry barriers in the labour market for individuals facing substantial challenges. The prevailing labour market policies predominantly centre around the activation strategy, however, vulnerable groups, grappling with individual and contextual obstacles, encounter difficulties overcoming societal stigmas to secure lasting employment. This study delves into how WISEs experiment with cross-sector partnerships (CSPs) to tackle these challenges. Through collaboration with public authorities and private entities, WISEs convert transitional initiatives into enduring, valuable experiences for beneficiaries. The paper scrutinises two case studies, shedding light on tensions encountered and how organisations navigate tensions to uphold social objectives amid partnerships with entities possessing distinct logics and goals. Despite the success in providing positive experiences and practical skills, CSPs introduce complexity and inter-organisational tensions. The research identifies mechanisms and strategies employed by WISEs to prevent mission drift and sustain a focus on work integration. The study underscores the imperative for further research on CSPs in work integration, recognising their increasing individual, local and policy impact, along with the organisational implications they entail.

GREECE vs. SPAIN: Similarities and Differences in the Evolution of Unemployment in the 21st Century

Unemployment is one of the main problems facing today's economies. In the context of the European Union, it is the Mediterranean economies that have traditionally shown a less favorable evolution of unemployment. This paper presents an explanatory model of the evolution of unemployment in two of these Mediterranean economies, Greece, and Spain, since the launching of the European Monetary Union. These were two of the European economies hardest hit by the Great Recession of 2008 and subsequently by the pandemic in 2020, so it is interesting to study which economic factors would explain the evolution of their unemployment rates. For this purpose, economic variables such as GDP pc, the output gap, investment, deficit, the employment rate by educational levels, inflation, labour productivity, labour force and public spending as a percentage of GDP. On the other hand, it is interesting to note to what extent Greece and Spain have or have not shown similar patterns of behavior of their labour markets so far this century, and what kind of economic policy measures could be put in place to ensure that both countries cease to have one of the highest unemployment rates in the EU. Finally, it will be analyzed how they have been affected by the Great Recession and the covid health crisis. Keywords: unemployment rate, macroeconomic variables, labour market policies, Great Recession, COVID-19

Employment and Skill Development Initiatives in the Labor Markets: The Cases of Indonesia and Thailand

This study delves into the intricate dynamics of labor markets in Indonesia and Thailand, revealing the symbiotic relationship between policy attributes, vocational education, and collaborative governance, all anchored in a robust theoretical framework encompassing policy attributes. The central question driving this research is: How can the government effectively mitigate labor market challenges in Indonesia and Thailand? To answer this question, the study aims to illuminate the interplay of solubility, complexity, scale, divisibility, monetarization, scope, and interdependence attributes within labor market policies. Employing a case study as its primary research strategy, the study analyzes data from diverse sources, including labor force statistics, policy documents, and academic literature. The Indonesian government, driven by the commitment to address the multifaceted challenges of unemployment and skill gaps, has formulated strategic initiatives to increase productivity and competitiveness. Thailand’s School in Factory Programs is an exemplary model, showcasing a comprehensive approach to workforce competence by seamlessly integrating education with industry needs. The analysis extends to the broader context of population policies, drawing valuable lessons from the Republic of South Korea. The success of South Korea’s population policy highlights the relevance of principles such as New Public Management (NPM), New Public Governance (NPG), and New Public Service (NPS). These principles are subsequently intertwined with the Indonesian and Thai cases, providing a comprehensive understanding of governance dynamics within the context of population and employment strategies.

Labour market policy directed at ex-prisoners in Poland

Labour market policy directed at ex-prisoners in Poland

Would it have been cheaper to let them become unemployed? Costs and benefits of First Aid intervention for companies in Slovakia during the COVID-19 pandemic

Research background: The global COVID-19 pandemic, which started in the first quarter of 2020, triggered unprecedented economic challenges, prompting governments worldwide to implement intervention measures to mitigate its impacts on business and employment. Without the state’s financial help, many companies were forced to lay off their employees. Among these measures was the First Aid intervention program introduced in Slovakia in April 2020, aimed at providing financial support to companies facing operational disruptions and potential layoffs of their employees. Purpose of the article: This study assesses the impact of the First Aid intervention program during the COVID-19 pandemic on unemployment in selected sectors, with an emphasis on the financial aspect, emphasising the international relevance and long-term implications of the state intervention in the crisis period. By analysing its effectiveness in preserving jobs and mitigating unemployment in selected sectors, the research seeks to offer valuable insights that can inform crisis response strategies and labour market policies in the country and beyond national borders. Methods: Employing a counterfactual approach, we quantify the financial consequence of the First Aid+ intervention program on the state budget, comparing unemployment costs against the benefits of maintaining employment in targeted sectors. Through this methodological framework, we aim to provide a replicable model for evaluating the efficacy of intervention programs in different socio-economic contexts. Findings & value added: Our analysis reveals not only the immediate impacts of the First Aid+ program on mitigating unemployment during the pandemic, but also its broader implications for policy and crisis management strategies. By elucidating the cost-benefit analysis of intervention measures, the research contributes to the effective labour market policies in times of crisis.

‘Flexibility’ and ‘security’ from rivals to teammates: a short history of flexicurity

This article provides a short yet comprehensive historical review of ‘flexicurity,’ an equally acclaimed and debated public policy of the first two decades of the 20th century. Early understandings of ‘flexibility’ and ‘security’ in labor economics placed the two terms in antithetic positions, generally defining ‘flexibility’ as the lack of ‘security’ or considering ‘security’ as the cause for the lack of ‘flexibility.’ The change in social standards in the early 1990s generated the emergence of ‘transitional labor markets,’ a concept that further facilitated the appearance of a new labor market policy – ‘flexicurity.’ The article presents each of these stages in the development of flexicurity. It describes the stories of the three most influential flexicurity cases - the Dutch, the Danish, and the European Union.

The Interactions between Labour Market Policies and Income Inequalities in Groups of European Union Countries

Social cohesion and a sustainable labour market remain the aims of sustainable development policy. However, income inequalities and labour market policies are more often separately analysed. To fill the identified research gap, our article presents the results of an analysis of interactions between active and passive labour market policies and income inequalities in the European Union. The 27 countries were divided into two clusters based on their active and passive labour market policy (LMP) expenditures in 2019. These clusters sustain the basis for analysing the interactions between LMP and income inequalities in its different measures. The results reveal that labour market interventions interact with income inequalities, decreasing disposable income inequalities (equalising the disposable income after transfers and taxes) and therefore contributing to social cohesion. This paper concerns social cohesion as the manifestation of intragenerational justice.