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Time Off to Upgrade Skills: The Labour Market Effects of a Large-Scale Educational Leave Programme

Author

Listed:
  • Benjamin Bittschi

    (WIFO)

  • Rainer Eppel

    (WIFO)

  • Ulrike Famira-Mühlberger

    (WIFO)

  • Helmut Mahringer

    (WIFO)

  • Christine Zulehner

Abstract

This paper combines a counterfactual impact analysis using rich administrative data with a participant survey to assess the long-term labour market effects of Austria's large-scale educational leave programme. The scheme allows eligible employees to take full- or part-time leave for further education, supported by income-compensating benefits. We find that participation substantially increases monthly earnings but does not improve employment probability. Full-time leave reduces employment in the short term and modestly in the long term, offsetting wage gains and resulting in no increase in cumulative earnings. Part-time leave yields even larger monthly wage increases and clear cumulative earnings gains, with no significant employment effects.

Suggested Citation

  • Benjamin Bittschi & Rainer Eppel & Ulrike Famira-Mühlberger & Helmut Mahringer & Christine Zulehner, 2025. "Time Off to Upgrade Skills: The Labour Market Effects of a Large-Scale Educational Leave Programme," WIFO Working Papers 712, WIFO.
    • Handle: RePEc:wfo:wpaper:y:2025:i:712
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    References listed on IDEAS

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    1. Didier Fouarge & Trudie Schils & Andries de Grip, 2013. "Why do low-educated workers invest less in further training?," Applied Economics, Taylor & Francis Journals, vol. 45(18), pages 2587-2601, June.
    2. David Card & Jochen Kluve & Andrea Weber, 2010. "Active Labour Market Policy Evaluations: A Meta-Analysis," Economic Journal, Royal Economic Society, vol. 120(548), pages 452-477, November.
    3. Pirmin Fessler & Alyssa Schneebaum, 2019. "The educational and labor market returns to preschool attendance in Austria," Applied Economics, Taylor & Francis Journals, vol. 51(32), pages 3531-3550, July.
    4. repec:taf:applec:45:y:2013:i:18:p:2587-2601 is not listed on IDEAS
    5. Stevens, Margaret, 1994. "A Theoretical Model of On-the-Job Training with Imperfect Competition," Oxford Economic Papers, Oxford University Press, vol. 46(4), pages 537-562, October.
    6. McCall, B. & Smith, J. & Wunsch, C., 2016. "Government-Sponsored Vocational Education for Adults," Handbook of the Economics of Education,, Elsevier.
    7. Imbens,Guido W. & Rubin,Donald B., 2015. "Causal Inference for Statistics, Social, and Biomedical Sciences," Cambridge Books, Cambridge University Press, number 9780521885881, January.
    8. Alberto Abadie & Guido W. Imbens, 2006. "Large Sample Properties of Matching Estimators for Average Treatment Effects," Econometrica, Econometric Society, vol. 74(1), pages 235-267, January.
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