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Active Labor Market Policies: Lessons from Other Countries for the United States

Author

Listed:
  • Chad P. Bown

    (Peterson Institute for International Economics)

  • Caroline Freund

    (World Bank)

Abstract

US labor force participation has been weak in recent decades, especially during the recovery of the financial crisis of 2007–09. This paper examines several programs that governments in other advanced industrial countries have established to help jobless workers continue to seek employment, not drop out of the labor force, and ultimately find jobs. These programs more actively support out-of-work citizens by facilitating matches between workers and firms, helping workers in their job searches, and sometimes creating jobs when none are available in the private sector. The paper concludes that job placement services, training, wage subsidies, and other labor adjustment policies can be used to successfully help workers find employment and remain tied to the labor market. By contrast, direct job creation through public works projects and other government programs are less effective in helping workers over the long run.

Suggested Citation

  • Chad P. Bown & Caroline Freund, 2019. "Active Labor Market Policies: Lessons from Other Countries for the United States," Working Paper Series WP19-2, Peterson Institute for International Economics.
    • Handle: RePEc:iie:wpaper:wp19-2
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    File URL: https://www.piie.com/publications/working-papers/active-labor-market-policies-lessons-other-countries-united-states
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    Citations

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    Cited by:

    1. Didem Koca, 2022. "Comparative Analysis of the Labor Market Structure and Active Labor Market Policies of G7 Countries and Turkey Between 2000-2020," Journal of Social Policy Conferences, Istanbul University, Faculty of Economics, vol. 0(83), pages 101-140, December.
    2. Furth Salim, 2020. "Does Census Hiring Stimulate Jobs Growth?," IZA Journal of Labor Policy, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 10(1), pages 1-21, March.
    3. Holzer, Harry J., 2021. "After COVID-19: Building a More Coherent and Effective Workforce Development System in the US," IZA Policy Papers 174, Institute of Labor Economics (IZA).
    4. Humlum, Anders & Munch, Jakob R. & Rasmussen, Mette, 2023. "What Works for the Unemployed? Evidence from Quasi-Random Caseworker Assignments," IZA Discussion Papers 16033, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    active labor market policies; placement services; training; wage insurance; education;
    All these keywords.

    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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