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The effect of temporary in-work support on employment retention: Evidence from a field experiment

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  • Dorsett, Richard

Abstract

A recent experimental programme for unemployed welfare recipients in the UK found that temporary earnings supplements combined with post-employment services led to a sustained rise in employment. This paper examines whether this was due to increases in employment entry or to reductions in employment exit. Using a hazard rate model, we find a significant effect on initial employment entry but not on subsequent transitions. The results also show that the length of a completed unemployment spell has a negative effect on the hazard of exit from the next unemployment spell. While the direct effect of the programme is to shorten the initial unemployment spell, an indirect effect arises due to this lagged duration dependence.

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  • Dorsett, Richard, 2014. "The effect of temporary in-work support on employment retention: Evidence from a field experiment," Labour Economics, Elsevier, vol. 31(C), pages 61-71.
    • Handle: RePEc:eee:labeco:v:31:y:2014:i:c:p:61-71
    DOI: 10.1016/j.labeco.2014.10.002
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    27. Dr Richard Dorsett, 2013. "Can Post-Employment Services Combined with Financial Incentives Improve Employment Retention for Welfare Recipients? Evidence from the Texas Employment Retention and Advancement Evaluation," National Institute of Economic and Social Research (NIESR) Discussion Papers 409, National Institute of Economic and Social Research.
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    Cited by:

    1. 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.
    2. Bruno Van der Linden, 2021. "Do in-work benefits work for low-skilled workers?," IZA World of Labor, Institute of Labor Economics (IZA), pages 246-246, June.
    3. Hjertstrand, Per & Norbäck, Pehr-Johan & Persson, lars, 2017. "The Educated Underdog Becomes the Ultimate Superstar," Working Paper Series 1176, Research Institute of Industrial Economics.
    4. Fumarco, Luca & Gibbs, Benjamin & Jarvis, Jonathan & Rossi, Giambattista, 2016. "The Relative Age Effect Reversal among NHL Elite," MPRA Paper 75691, University Library of Munich, Germany.
    5. Luca Fumarco & Benjamin G Gibbs & Jonathan A Jarvis & Giambattista Rossi, 2017. "The relative age effect reversal among the National Hockey League elite," PLOS ONE, Public Library of Science, vol. 12(8), pages 1-16, August.
    6. Richard Hendra & James Riccio & Richard Dorsett & Philip Robins, 2015. "Breaking the low pay, no pay cycle: the effects of the UK Employment Retention and Advancement programme," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-32, December.
    7. John R Doyle & Paul A Bottomley, 2018. "Relative age effect in elite soccer: More early-born players, but no better valued, and no paragon clubs or countries," PLOS ONE, Public Library of Science, vol. 13(2), pages 1-13, February.

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    More about this item

    Keywords

    Employment retention; Earnings supplements; Treatment effects; Duration model; Unobserved heterogeneity;
    All these keywords.

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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