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Effectiveness of Further Vocational Training in Germany – Empirical Findings for Persons Receiving Means-tested Unemployment Benefits

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  • Sarah Bernhard
  • Thomas Kruppe

Abstract

Further vocational training for the unemployed aims at enhancing their job prospects. This paper analyzes the effectiveness of subsidized training programs for means-tested unemployment benefit recipients in Germany. The empirical findings are based on rich administrative data from the German Federal Employment Agency using propensity score matching to construct a suitable comparison group. We consider the initiation of training in early 2005, just after the reform of the German means-tested benefit system, which aimed at activating hard-to-place job-seekers, and after the introduction of a voucher system as the sole assigning mechanism for vocational training. We estimated the effects of vocational training for several groups differentiated by age, gender, migration background, skills, program duration, length of time since last job and differences between East and West Germany. As a result, we show that vocational training has a considerable beneficial impact on participants as it raises the employment rate in the intermediate term by up to 13 percentage points, and – with a slightly lower impact – it reduces the number of unemployment benefit II recipients.

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  • Sarah Bernhard & Thomas Kruppe, 2012. "Effectiveness of Further Vocational Training in Germany – Empirical Findings for Persons Receiving Means-tested Unemployment Benefits," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 132(4), pages 501-526.
  • Handle: RePEc:aeq:aeqsjb:v132_y2012_i4_q4_p501-526
    DOI: 10.3790/schm.132.4.501
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    2. Thomas Kruppe & Julia Lang, 2018. "Labour market effects of retraining for the unemployed: the role of occupations," Applied Economics, Taylor & Francis Journals, vol. 50(14), pages 1578-1600, March.
    3. Spermann, Alexander, 2014. "Zehn Jahre Hartz IV – Was hilft Langzeitarbeitslosen wirklich?," IZA Standpunkte 76, Institute of Labor Economics (IZA).
    4. Katharina Dengler, 2019. "Effectiveness of sequences of classroom training for welfare recipients: what works best in West Germany?," Applied Economics, Taylor & Francis Journals, vol. 51(1), pages 1-46, January.
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    7. Caliendo, Marco & Mahlstedt, Robert & Mitnik, Oscar A., 2017. "Unobservable, but unimportant? The relevance of usually unobserved variables for the evaluation of labor market policies," Labour Economics, Elsevier, vol. 46(C), pages 14-25.
    8. Marco Caliendo & Ricarda Schmidl, 2016. "Youth unemployment and active labor market policies in Europe," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-30, December.
    9. Heyer, Gerd & Koch, Susanne & Stephan, Gesine & Wolff, Joachim, 2011. "Evaluation der aktiven Arbeitsmarktpolitik: Ein Sachstandsbericht für die Instrumentenreform 2011 (Evaluation of active labor market programs : a summary of recent results for the German program refor," IAB-Discussion Paper 201117, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    10. Alexander Spermann, 2015. "How to fight long-term unemployment: lessons from Germany," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-15, December.
    11. Paul, Marie & Dörr, Annabelle & Fitzenberger, Bernd & Kruppe, Thomas & Strittmatter, Anthony, 2013. "The Award of a Training Voucher and Labor Market Outcomes," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79918, Verein für Socialpolitik / German Economic Association.
    12. Wapler, Rüdiger & Wolf, Katja & Wolff, Joachim, 2018. "Do active labour market policies for welfare recipients in Germany raise their regional outflow into work? : A matching function approach," IAB-Discussion Paper 201808, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    13. Arntz, Melanie & Gregory, Terry & Zierahn, Ulrich, 2016. "ELS issues in robotics and steps to consider them. Part 1: Robotics and employment. Consequences of robotics and technological change for the structure and level of employment," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 146501.
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    16. Moritz Zöllner & Michael Fritsch & Michael Wyrwich, 2016. "An Evaluation of German Active Labor Market Policies and its Entrepreneurship Promotion," Jena Economics Research Papers 2016-022, Friedrich-Schiller-University Jena.
    17. Deeke, Axel & Baas, Meike, 2012. "Berufliche Statusmobilität von Arbeitslosen nach beruflicher Weiterbildung : ein empirischer Beitrag zur Evaluation der Förderung beruflicher Weiterbildung," IAB-Discussion Paper 201211, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    18. Dauth, Wolfgang & Südekum, Jens, 2012. "Profiles of local growth and industrial change : facts and an explanation," IAB-Discussion Paper 201220, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    19. Stefan Denzler & Jens Ruhose & Stefan C. Wolter, 2022. ""The double-dividend of training" - Labour market effects of work-related continuous education in Switzerland," Economics of Education Working Paper Series 0196, University of Zurich, Department of Business Administration (IBW).
    20. Kopf, Eva & Zabel, Cordula, 2014. "Active labour market programmes for women with a partner : challenge or replication of traditional gender roles," IAB-Discussion Paper 201406, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    21. Wapler, Rüdiger & Wolf, Katja & Wolff, Joachim, 2022. "Do active labor market policies for welfare recipients in Germany raise their regional outflow into work?," Journal of Policy Modeling, Elsevier, vol. 44(3), pages 550-563.
    22. Caliendo, Marco & Mahlstedt, Robert & Mitnik, Oscar, 2014. "Unobservable, but Unimportant? The Influence of Personality Traits (and Other Usually Unobserved Variables) for the Estimation of Treatment Effects," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100502, Verein für Socialpolitik / German Economic Association.
    23. Gerd Heyer & Susanne Koch & Gesine Stephan & Joachim Wolff, 2012. "Evaluation der aktiven Arbeitsmarktpolitik: Ein Sachstandsbericht für die Instrumentenreform 2011," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 45(1), pages 41-62, March.
    24. Vom Berge, Philipp & Klingert, Isabell & Becker, Sebastian & Lenhart, Julia & Trenkle, Simon & Umkehrer, Matthias, 2016. "Mindestlohnbegleitforschung - Überprüfung der Ausnahmeregelung für Langzeitarbeitslose : Forschungsauftrag des Bundesministeriums für Arbeit und Soziales (BMAS)," IAB-Forschungsbericht 201608, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J69 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Other

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