Home Work: Exploring the Labor Market Effects of Subsidizing Domestic Services (with Ilan Tojerow), Labour Economics, 2024, vol. 90.
This paper analyzes subsidies for the domestic services sector, an increasingly popular policy to create employment opportunities for low-skilled workers. Using Belgian administrative data, a differences-in-differences approach, and a shift-share instrumental variable, we estimate the local effects of the policy in targeted industries as well as overall effects on the labor market. We find that domestic service subsidies can increase female employment in the subsidized industries as well as the overall employment rate. This increase in employment is primarily driven by an increase in (formal) labor market participation and, to a lesser extent, a reduction in the rate of participation in unemployment insurance and in other social welfare programs. We also find that these subsidies can lead to an increase in the rate of work incapacity, likely due to the fact they broaden the population that can access the social safety net.
[Featured in La Libre and this short video]
Previously circulated as IZA Discussion Paper No. 13544, entitled "Subsidizing Domestic Services as a Tool to Fight Unemployment: Effectiveness and Hidden Costs"
The Consequences of Job Search Monitoring for the Long-Term Unemployed: Disability Instead of Employment? (with Octave De Brouwer and Ilan Tojerow), Journal of Public Economics, 2023, volume 224.
We study the effect of job search monitoring (JSM) on individual labor market outcomes of the long-term unemployed. Exploiting the implementation of a JSM program targeted at jobseekers under the age of 49, we set up a regression discontinuity design that credibly identifies the program’s causal effect on unemployment, employment, and disability insurance (DI) participation and participation in other social welfare programs within a three-year period. We find that JSM increases exits from unemployment to DI without affecting transitions into employment or other social welfare programs. We further find that the effect of JSM on DI materializes before any sanction can be imposed and monitored individuals are still 10 percentage points more likely to be on DI three years after the start of monitoring. Ultimately, exploring fiscal implications reveals that the decrease in unemployment transfers as a result of JSM is entirely offset by the increase in DI transfers.
Previously circulated as IZA Discussion Paper No. 12304, entitled "The Unexpected Consequences of Job Search Monitoring: Disability Instead of Employment?"
Closing the Mismatch: Encouraging Jobseekers to Reskill for Shortage Occupations, IZA Disucssion Paper No. 17731 (with Ilan Tojerow)
We partner with a Public Employment Service to examine whether jobseekers can be encouraged to reskill for shortage occupations. In a large-scale field experiment involving 100,000 recently unemployed individuals, we provide information on shortage occupations and related training opportunities. The intervention increased participation in trainings by 6%, driven by an increased take-up of transversal programs (+10%) rather than specialized occupational training for shortage jobs. Jobseekers also shifted their search towards high-demand occupations, yet employment remained unchanged. These findings suggest that while low-cost informational interventions can influence job search and training behaviour, stronger or more targeted measures are needed to translate these behavioural changes into actual transitions toward shortage occupations.
"Long-term effects of a housing policy reform", with Anne Gielen, Olivier Marie and Tommaso Tulkens
This project investigates the effects of the “Rotterdam Wet”, a Dutch policy that aims at improving the livability in some impoverished neighborhoods by temporarily stopping the influx of disadvantaged individuals. It allows municipalities to deny access to public housing in targeted areas to individuals with certain characteristics deemed undesirable (e.g., those without income from work or with a criminal record). Using rich administrative data, we will estimate the effects of the policy on neighborhood livability, as well as effects on the socio-economic outcomes of directly and indirectly affected individuals.
"Understanding Reskilling Decisions to Address Mismatch Unemployment", with Benjamine Dejardin, Alexia Delfino, Raffaella Sadun, and Ilan Tojerow
Rapidly evolving labor markets have led to skill mismatches and a growing need for workforce reskilling. This study explores the drivers of jobseekers' reskilling decisions through a discrete choice experiment conducted with a Public Employment Service in Belgium. We collect responses from 3,623 unemployed jobseekers, through a combination of email invitations to complete the survey and data collection in the field. We find that the unemployed hold strong occupational preferences in the context of training decisions, but that these preferences can be shifted under some conditions. Training program attributes, such as shorter waiting times and commuting distances, the teaching format, and involving employers in the organization of the training program, can increase willingness to reskill. Working conditions in the target occupation such as salary, career evolution prospects, work demands and schedule flexibility, also matter for reskilling decisions. We discuss implications for policy-makers and employers struggling to find adequately skilled workers.
"Finding the Perfect Employment Fit: Mismatch Unemployment and Occupational Training Programs", with Benjamine Dejardin and Ilan Tojerow
In this project, we develop a tool that provides tailored training recommendations to potential program participants. The tool is based on the same philosophy as the transition matrix studied in Belot et al. (2019), but rather than occupational job search recommendation, it provides training recommendations based on the education, past professional experience, or occupational preferences. We are currently fine-tuning the recommendation tool and discussing its testing in the field with our institutional partners.