Can Subsidized Employment Tackle Long-Term Unemployment? Experimental Evidence from North Macedonia

68 Pages Posted: 29 Jul 2020

See all articles by Alex Armand

Alex Armand

University of Navarra

Pedro Manuel Carneiro

University College London - Department of Economics; IZA Institute of Labor Economics

Federico Tagliati

Banco de España

Yiming Xia

University College London

Abstract

This paper examines the impact of an experiment in North Macedonia in which vulnerable unemployed individuals applying to a subsidized employment program were randomly selected to attend job interviews. Employers hiring a new employee from the target population receive a subsidy covering the wage cost of the worker for the first six months. Using administrative employment data, we find that attending the job interview led to an increase of 15 percentage points in the likelihood of being employed 3.5 years after the start of the intervention. We also find positive and statistically significant effects on individuals' non-cognitive and work-related skills.

JEL Classification: O15, J08, J68

Suggested Citation

Armand, Alex and Carneiro, Pedro Manuel and Tagliati, Federico and Xia, Yiming, Can Subsidized Employment Tackle Long-Term Unemployment? Experimental Evidence from North Macedonia. Available at SSRN: https://ssrn.com/abstract=3654915 or http://dx.doi.org/10.2139/ssrn.3654915

Alex Armand (Contact Author)

University of Navarra ( email )

Camino del Cerro del Aguila, 3
Pamplona, Navarra 31080
Spain

HOME PAGE: http://alexarmand.org

Pedro Manuel Carneiro

University College London - Department of Economics ( email )

Gower Street
London WC1E 6BT, WC1E 6BT
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Federico Tagliati

Banco de España ( email )

Alcala 50
Madrid 28014
Spain

Yiming Xia

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

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