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Labour market effects of retraining for the unemployed: the role of occupations

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  • Thomas Kruppe
  • Julia Lang

Abstract

We analyse the impact of retraining for unemployed low-skilled job-seekers in Germany. This extensive training programme leads to a formal vocational degree, which is often required to access certain professions. Applying statistical matching methods, we find that on average, after a period with large lock-in effects, retraining strongly increases the employment probability of participants, especially women. We add to the literature by estimating the employment effects for different occupations for which participants are trained. Our results show that there are substantial differences depending on the occupation. As the composition of trained occupations differs for men and women, segregation could be a driver of higher employment effects for women. However, comparisons of men and women trained for the same occupations reveal that even after controlling for segregation, women profit more from retraining. While caseworkers are instructed to choose professions with high labour demand, other aspects, such as working conditions, preferences and aptitudes of participants, should be crucial in the choice of a suitable occupation. An individual assessment of the suitability of an occupation could therefore improve the overall effectiveness of the programme.

Suggested Citation

  • 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.
    • Handle: RePEc:taf:applec:v:50:y:2018:i:14:p:1578-1600
    DOI: 10.1080/00036846.2017.1368992
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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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