Essays on the effects of labor market programs targeted at vulnerable groups

Increasing the employment rate of the working age population has been at the top of policy and research agendas alike. In this thesis, I study the impacts of three flagship Active Labour Market programs – a job search monitoring program, a wage subsidy, and a training program – targeted at vulnerable populations. In the first chapter, I study the effects of a job search monitoring policy targeted at the long-term unemployed, focusing not only on transitions from unemployment to employment, but also on participation in other social welfare programs. Using a Regression Discontinuity Design, I show that the program decreased the probability of remaining unemployed, but only through an increase in the probability of receiving Disability Insurance benefits. Employment and participation in other types of social welfare programs are, on the other hand, unaffected. These findings highlight that, for individuals who are on the fringes of the labour market, job search monitoring might not be sufficient to foster a return to employment. In the second chapter, I use a Difference-in-Differences approach to study the effects of implementing domestic service subsidies on employment and work disability in the targeted sectors. I then complement this analysis with an event study Difference-in-Differences approach that allows to uncover how working in these subsidized jobs affects the labour market outcomes of subsidized workers. I show that domestic service subsidies can be an effective means of creating employment opportunities for low-skilled workers in the sector of domestic services, by both reducing unemployment and increasing labour market participation of the target group. I also show that PHS subsidies can entail important unintended costs for the Disability Insurance and possibly deteriorate the health of subsidized workers. In the last chapter, I explore whether jobseekers can be encouraged to follow trainings for shortage occupations through a low-cost information intervention. To do so, I implement a randomized field experiment on the labour market, that informs all recently registered unemployed jobseekers about the existence of labour shortages, and the availability and advantages of following related trainings. I show that providing jobseekers with this information increases their intentions to follow a training, improves their perceptions about the usefulness of trainings as an effective job search strategy, and leads some to change their training behaviour.