Effects of Active Labor Market Programs on the Transition Rate from Unemployment into Regular Jobs in the Slovak Republic

The system of active labor market policies (ALMP) in the Slovak Republic consists to a large extent of the creation of socially purposeful and publicly useful jobs and of retraining of unemployed workers. So far, the effects of these types of active labor market policies have hardly been analyzed. This paper uses a unique administrative data from 20 Slovak districts to analyze to what extent it is beneficial for unemployed workers who want a regular job to accept a temporary ALMP-job or enter a retraining program. We find that indeed it is beneficial for workers to do so.

Lubyova and Ours (1999)Urban.Model the duration of unemployment and duration of stay in an ALMP program.Two ALMP programs providing retraining and counseling services, and wage subsidies at either socially purposeful jobs (up to 2 years) or publicly useful jobs (up to 6 months at public works-type job).Workers that enter ALMP have a 150% increase in the exit rate into a regular job. Benefits of retraining were only observed for socially purposeful jobs.http://www.sciencedirect.com/science/article/pii/S0147596798915712Adult unemployed workers.