Working towards sustainable labor market integration: The long-term effects of a company-based work-experience program

Roy Peijen

Research output: ThesisDoctoral Thesis

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Abstract

Summary
In the Netherlands, many groups are sidelined regarding their labor market opportunities, i.e., youth, low-educated individuals, ethnic minorities, and partially disabled individuals, particularly in times of economic downturn. Due to increased labor market dualization, access to better jobs is reserved only for those who have mastered professional skills. TI1e public support rapidly brings the unemployed back to work but is criticized for its negligible and sometimes even adverse long-term impacts for vulnerable workers. Explanations point to the limited supportive and skills-upgrading services in this genera! approach along with the unemployed' unrepaired deficit in the desired skills, making these groups continuously prone to nonstandard employment and unemployment. More inclusive efforts might support these vulnerable workers to secure jobs more adequately, which appears to be more topical than ever, e.g., the COVID-19 crisis on unemployment.
The Philips Employment Scheme (Philips Werkgelegenheidsplan [WGP] in Dutch) offers vulnerable unemployed workers one-to-two years of work experience with (in)formal training to move participants into jobs externally. Participants are employed, seen from the outside, in regular employment. In contrast, people on public support might remain long-term unemployed and have increased risks of nonstandard employment. The literature teaches us that such programs pay off in the long run only but have little impact on short notice. However, the WGP already proved to be effective on short notice, making it an interesting case for study. This dissertation observed the extent to which this company-based work-experience program better supports low-educated and inadequately-ski!led workers to return to the labor market and to build up high levels of employment security in sustainable jobs with proper wage matches over their future careers than public activation programs based on workfare principles that !ack these human capita! and work-experience investments?
Earlier studies on ALMPs limited their observation periods to one-to-five years later. In contrast, the Statistic Netherlands' register data used for this dissertation made it possible to study the long­term impact of the WGP up to ten years later. The long-term effect of the WGP is determined by comparing the labor market outcomes of its former participants (1999-2014) with a comprehensive matched control group, sharing a large number of pre-treatment covariates as participants before the intervention, but public activation entitlement instead. Findings show that WGP participants have 8% more employment security for over ten years than control units. Still, the different studies conducted in this dissertation show substantial variation in the impact of WVGP participation among these studied groups.
More investment opportunities would improve vulnerable unemployed' chances to regain sustainable employment, as the WGP does with its more tailored approach. Other large companies might start similar tailor-made initiatives to improve the career opportunities of the disadvantaged, particularly in industries and regions that forecast declines in qualified personnel. This dissertation provides an argument for encouraging other employers to take up their responsibilities as well, and to invest in work experience and training for all their employees, but also urges the Dutch government to increase the budget on forma! training for the unemployed. Closer collaboration between public authorities and the business sector might forward vulnerable workers' careers, notably from a long­term perspective. 
Original languageEnglish
Awarding Institution
  • Tilburg University
Supervisors/Advisors
  • Wilthagen, Ton, Promotor
  • Muffels, Ruud, Promotor
Award date16 Oct 2020
Publisher
Print ISBNs 978-94-640-2208-7
Publication statusPublished - Oct 2020

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