The effects of more intensive counseling for disadvantaged unemployed youth

Eppel, Rainer; Mahringer, Helmut

The effects of more intensive counseling for disadvantaged unemployed youth

IZA Journal of Labor Policy

Volume 13 (2023): Issue 1 (January 2023)

By:

Rainer Eppel and Helmut Mahringer

Open Access

|Nov 2023

Figures & Tables

Ø Effects of intensified counseling on unemployment duration, benefit receipt duration, benefit receipt after 3 years and average post-unemployment monthly earnings

	Treated	Controls	Difference

	Case management	No case management	ATT

			Absolute	Relative

	In days
Remaining unemployment duration	530	515	15(32)	2.9
Unemployment insurance benefit duration
Unemployment benefit	48	42	5(6)	12.9
Unemployment assistance	68	65	2(12)	3.3
Other unemployment insurance benefits	200	175	25(12)^**	14.4
Subsistence allowance scheme	162	137	25(11)^**	18.5
Travel expenses	37	38	−1(5)	−1.4

Share in % / Percentage point change
Benefit receipt after 3 years
Unemployment insurance benefits
Unemployment benefit	8.6	8.7	−0.1(2.6)	−0.8
Unemployment assistance	7.2	7.7	−0.4(2.3)	−5.7
Other unemployment insurance benefits	8.3	9.4	−1.1(2.0)	−11.5
None	75.9	74.3	1.6(3.2)	2.1
Social assistance	27.3	27.4	−0.1(3.4)	−0.4

In €
Average monthly wage
2 years after pilot entry	1,041	1,064	−23(33)	−2.1
Calendar years 2019 and 2020	1,047	1,069	−22(26)	−2.1

Logit estimates of the propensity scores

	Odds Ratio (SE)
Female	1.472^*** (0.198)
Age (in years)	0.567^*** (0.040)
At least compulsory school	1.117 (0.171)
Health-related placement restriction¹	5.032^*** (2.453)
Nationality
Austria	1.854 (0.685)
Turkey, former Yugoslavia	0.778 (0.302)
Naturalized	0.621^* (0.173)
Asylum status
Eligible for asylum (convention refugee)	1.015 (0.315)
Subsidiary protection	0.655 (0.221)
German language level A	2.023^** (0.531)
German language level B	1.974^*** (0.451)
Status at end of previous month
Registered unemployed	0.481^** (0.135)
Looking for an apprenticeship	0.377^*** (0.108)
In PES training	0.611^* (0.179)
In employment	0.997 (0.407)
Out of the labor force	0.532^** (0.159)
In basic qualification	0.509^** (0.153)
In vocational orientation	0.751 (0.276)
In external counseling	1.449^* (0.270)
Social assistance full receipt²	3.777^*** (0.704)
Social assistance partial receipt²	6.120^*** (1.355)
Unemployment assistance receipt	0.848 (0.360)
Previous unemployment duration (days)	1.001 (0.001)
Days in registered unemployment	0.997 (0.002)
Days in PES training	0.999 (0.002)
Days looking for an apprenticeship	0.998 (0.002)
No previous dependent employment	1.208 (0.259)
Last income >1,000 €	0.624 (0.185)
Employment history: days in last 5 years³
Active unsubsidized dependent employment	1.000 (0.003)
Apprenticeship	0.999 (0.003)
Active subsidized dependent employment 1^st labor market	0.998 (0.003)
Active subsidized dependent employment 2^nd labor market	1.001 (0.001)
Temporary absence	1.000 (0.001)
Self-employment	1.007 (0.007)
Registered unemployment	1.008^*** (0.002)
PES training	1.001 (0.001)
Apprenticeship search	1.003^*** (0.001)
Other unemployment status	1.002 (0.002)
Employment history: days in last 2 years³
Active unsubsidized dependent employment	1.005^* (0.003)
Active subsidized dependent employment 2^nd labor market	1.000 (0.002)
Registered unemployment	0.996^* (0.002)
PES training	0.999 (0.001)
Apprenticeship search	1.004^** (0.002)
Employment history: days in last year³
Active unsubsidized dependent employment	0.999 (0.005)
Apprenticeship	0.995 (0.006)
Active subsidized dependent employment 2^nd labor market	0.999 (0.003)
1 year ago employed	0.974 (0.401)
1 year ago unemployed	1.064 (0.206)
6 months ago employed	0.561 (0.266)
6 months ago unemployed	1.188 (0.222)
3 months ago employed	2.227^* (0.985)
3 months ago unemployed	0.858 (0.175)
1 year ago social assistance full receipt	1.187 (0.193)
1 year ago social assistance partial receipt	0.686^** (0.128)
Sickness benefit (unemployed) in last 2 years	0.870 (0.143)
Active labor market policy participation in last 2 years
Active job search	1.748^** (0.433)
Basic qualification	1.610^** (0.305)
Vocational orientation	1.008 (0.152)
Training and further education	1.612^** (0.354)
Supra-company apprenticeship training	1.137 (0.424)
EAPQ	0.759 (0.318)
External counseling	0.850 (0.127)
Nr. PES contacts in last 6 months	1.130^** (0.051)
Nr. PES contacts in last 2 years	0.966 (0.027)
Nr. PES placement offers in last 6 months	1.003 (0.026)
Nr. PES placement offers in last 2 years	0.921^*** (0.014)
Last profession
Simple/basic services	1.823^* (0.526)
Accommodation, food service	1.397 (0.433)
Law	2.619^** (0.890)
Production	1.318 (0.233)
Trade and sales	1.303 (0.285)
Last employment in the public sector	1.264 (0.394)
Unemployment insurance benefit daily rate
≤5 €	0.901 (0.281)
≤ 15 €	0.619^* (0.157)
≤ 20 €	1.110 (0.284)
Social assistance receipt⁴
Full receipt, single	1.354 (0.368)
Full receipt, no single	0.887 (0.336)
Partial receipt, single	1.533^* (0.340)
Partial receipt, no single	1.422^* (0.297)
Constant	1545.793^*** (2044.712)

Robustness of effects to sample and method variationØ Effects of intensified counseling on the labor market position after 3 years, ATT, in percentage points

	Matching								OLS

	(0)	(1)	(2)	(3)	(4)	(5)	(6)	(7)	No corr.	Corr.
Employed	0.7(3.4)	0.1(3.3)	0.7(3.3)	−0.3(3.6)	−2.2(4.4)	−0.5(3.8)	0.3(4.3)	0.3(5.2)	−5.1(2.4)^**	−1.3(2.7)
Dep. emp.	1.7(3.5)	0.7(3.3)	1.7(3.4)	0.7(3.6)	−1.9(4.5)	1.5(4.0)	1.4(4.1)	0.3(5.2)	−5.3(2.4)^**	−1.2(2.7)
Active dep. emp.	−0.8(3.5)	−0.9(3.3)	−1.0(3.4)	−2.0(3.6)	−5.2(4.5)^*	−0.9(3.9)	−0.8(4.1)	−1.1(5.2)	−6.9(2.4)^***	−2.4(2.7)
Reg. unemp.	−2.7(2.9)	−3.2(3.0)^*	−3.1(2.8)^*	−3.1(3.1)^*	−0.5(3.0)	−3.2(3.3)	−5.3(3.8)^*	1.6(2.8)	0.7(1.7)	−2.1(1.8)^**
PES training	2.5(2.2)^*	2.8(2.1)^*	3.2(2.0)^*	2.8(2.2)^*	0.7(3.0)	3.0(2.2)^*	2.6(2.5)^*	−0.8(3.8)	0.9(1.6)	1.4(1.9)
Apprent. search	−1.0(1.7)	−1.0(1.4)	−0.8(1.7)	−0.5(1.6)	−1.3(2.1)	−0.6(1.5)	0.0(1.7)	−1.6(2.1)	0.3(0.9)	−0.3(1.0)
Other unemp. status	−0.5(1.0)	−1.1(1.1)	−0.5(1.0)	−0.4(1.0)	0.4(0.9)	−0.4(0.8)	−0.8(1.3)	0.0(0.9)	−0.1(0.6)	−0.3(0.7)
Econ. inactive	0.8(2.6)	2.5(2.8)	0.6(2.7)	1.7(2.5)	2.8(3.1)	1.6(2.6)	3.5(3.1)^*	0.5(3.1)	3.3(1.7)^**	2.8(2)

Ø Effects of intensified counseling on the sum of days in different labor market positions in the three years after entry into case management

	Treated	Controls	Difference

	Case management	No case management	ATT

			Absolute	Relative

	In days		In days	in %
Employed	422	426	−4(25)	−0.9
Apprenticeship	237	230	7(27)	3.0
Unsubsidized	37	42	−5(12)	−12.7
Subsidized in companies	42	26	16(9)^*	60.3
Supra-company apprenticeship training	96	103	−7(18)	−7.2
EAPQ	63	59	4(18)	6.7
Other active dependent employment	157	178	−21(18)^*	−11.7
1^st labor market	137	165	−28(17)^*	−17.0
Workers	90	120	−29(15)^*	−24.6
Employees	39	37	1(9)	4.0
2^nd labor market (SEEs/NEPs)	20	13	7(4)^*	53.9
Registered unemployed	171	190	−19(16)^*	−10.1
PES Training	245	205	39(13)^**	19.1
Apprenticeship search	100	113	−13(11)^*	−11.5
Economically inactive	138	141	−4(15)	−2.5

Covariate balance before and after matching

	Before matching				After matching

	Mean		t-test		Mean		t-test

	Treated	Controls	Diff.	p > \|t\|	Treated	Controls	Diff.	p > \|t\|
Female	0.389	0.296	0.093^***	0.00	0.383	0.387	−0.005	0.84
Age (in years)	18.147	18.595	−0.448^***	0.00	18.131	18.178	−0.047	0.47
At least compulsory school	0.582	0.513	0.069^***	0.00	0.574	0.604	−0.029	0.20
Health-related placement restriction¹	0.042	0.010	0.032^***	0.00	0.032	0.024	0.008	0.28
Nationality
Austria	0.275	0.194	0.081^***	0.00	0.267	0.280	−0.013	0.54
Turkey, former Yugoslavia	0.064	0.049	0.015	0.16	0.066	0.057	0.008	0.45
Naturalized	0.093	0.068	0.025^*	0.06	0.095	0.105	−0.010	0.47
Asylum status
Eligible for asylum (convention refugee)	0.468	0.416	0.052^**	0.03	0.470	0.470	0.000	1.00
Subsidiary protection	0.142	0.299	−0.156^***	0.00	0.147	0.147	0.000	1.00
German language level A	0.231	0.294	−0.062^***	0.00	0.242	0.219	0.023	0.24
German language level B	0.533	0.490	0.043^*	0.07	0.531	0.551	−0.020	0.39
Status at end of previous month
Registered unemployed	0.170	0.229	−0.059^***	0.00	0.167	0.165	0.002	0.92
Looking for an apprenticeship	0.197	0.193	0.003	0.85	0.202	0.199	0.003	0.89
In PES training	0.483	0.456	0.027	0.24	0.485	0.477	0.008	0.73
In employment	0.143	0.086	0.057^***	0.00	0.131	0.135	−0.003	0.84
Out of the labor force	0.063	0.149	−0.085^***	0.00	0.061	0.051	0.010	0.34
In basic qualification	0.280	0.331	−0.050^**	0.02	0.293	0.283	0.010	0.65
In vocational orientation	0.068	0.048	0.020^*	0.08	0.069	0.071	−0.002	0.84
In external counseling	0.221	0.201	0.020	0.31	0.225	0.252	−0.027	0.18
Social assistance full receipt²	0.478	0.356	0.122^***	0.00	0.475	0.472	0.003	0.90
Social assistance partial receipt²	0.434	0.332	0.102^***	0.00	0.432	0.434	−0.002	0.94
Unemployment assistance receipt	0.055	0.043	0.012	0.24	0.047	0.034	0.014	0.13
Previous unemployment duration (days)	519.010	455.550	63.460^***	0.00	508.550	510.210	−1.660	0.92
Days in registered unemployment	63.205	74.537	−11.332^**	0.02	63.004	64.348	−1.344	0.77
Days in PES training	282.860	267.020	15.840	0.19	279.210	280.190	−0.980	0.93
Days looking for an apprenticeship	116.710	72.450	44.260^***	0.00	111.630	110.330	1.300	0.80
No previous dependent employment	0.729	0.722	0.007	0.74	0.747	0.759	−0.012	0.54
Last income >1,000 €	0.058	0.109	−0.051^***	0.00	0.061	0.057	0.005	0.66
Employment history: days in last 5 years³
Active unsubsidized dep. employment	21.858	24.516	−2.658	0.60	21.268	18.799	2.469	0.58
Apprenticeship
Active subsidized dep. employment 1^st lm	2.765	2.899	−0.135	0.91	2.566	3.634	−1.068	0.35
Active subsidized dep. employment 2^nd lm	73.487	48.354	25.133^***	0.00	66.018	69.442	−3.424	0.68
Temporary absence	3.398	3.477	−0.079	0.97	3.282	4.205	−0.922	0.65
Self-employment	1.116	0.429	0.686	0.38	1.040	0.228	0.812	0.26
Registered unemployment	79.867	82.482	−2.615	0.64	79.366	84.708	−5.342	0.36
PES training	271.240	250.450	20.790^*	0.05	270.990	267.210	3.780	0.72
Apprenticeship search	172.750	98.060	74.690^***	0.00	164.100	156.340	7.760	0.22
Other unemployment status	19.657	13.224	6.433^***	0.00	19.673	21.651	−1.978	0.39
Employment history: days in last 2 years³
Active unsubsidized dep. employment	12.942	13.596	−0.654	0.82	12.400	9.717	2.683	0.28
Active subsidized dep. employment 2^nd lm	52.850	36.675	16.175^***	0.01	49.288	52.080	−2.792	0.66
Employment history: days in last year³
Active unsubsidized dep. employment	5.743	7.148	−1.404	0.31	5.529	5.185	0.345	0.77
Apprenticeship	1.840	1.606	0.235	0.77	1.936	1.798	0.139	0.86
Active subsidized dep. employment 2^nd lm	35.341	23.806	11.535^***	0.00	32.820	35.113	−2.293	0.59
Registered unemployment	65.062	71.601	−6.539	0.17	64.420	70.614	−6.194	0.21
PES training	223.310	221.630	1.680	0.85	226.590	223.230	3.360	0.70
Apprenticeship search	118.000	67.393	50.607^***	0.00	113.360	108.800	4.560	0.33
1 year ago employed	0.105	0.090	0.015	0.27	0.097	0.101	−0.004	0.75
1 year ago unemployed	0.603	0.543	0.060^**	0.01	0.602	0.595	0.007	0.75
6 months ago employed	0.118	0.098	0.019	0.19	0.110	0.110	0.000	0.99
6 months ago unemployed	0.680	0.603	0.077^***	0.00	0.682	0.689	−0.007	0.76
3 months ago employed	0.107	0.065	0.043^***	0.00	0.099	0.113	−0.014	0.33
3 months ago unemployed	0.766	0.727	0.039^*	0.06	0.775	0.774	0.001	0.96
1 year ago social assistance full receipt	0.303	0.236	0.067^***	0.00	0.307	0.301	0.006	0.78
1 year ago social assistance partial receipt	0.175	0.210	−0.035^*	0.06	0.170	0.149	0.021	0.22
Sickness benefit (unemployed) in last 2 years	0.245	0.210	0.035^*	0.08	0.231	0.265	−0.035	0.08
ALMP participation in last 2 years
Active job search	0.124	0.065	0.059^***	0.00	0.117	0.126	−0.009	0.57
Basic qualification	0.666	0.681	−0.015	0.51	0.671	0.650	0.022	0.32
Vocational orientation	0.470	0.394	0.075^***	0.00	0.457	0.476	−0.020	0.40
Training and further education	0.134	0.078	0.056^***	0.00	0.123	0.120	0.003	0.84
Supra-company apprenticeship training	0.141	0.095	0.047^***	0.00	0.125	0.120	0.005	0.73
EAPQ	0.070	0.044	0.025^**	0.02	0.065	0.084	−0.019	0.11
External counseling	0.633	0.598	0.034	0.14	0.636	0.639	−0.003	0.89
Nr. PES contacts in last 6 months	2.664	2.237	0.427^***	0.00	2.613	2.593	0.020	0.86
Nr. PES contacts in last 2 years	7.142	5.844	1.298^***	0.00	6.894	6.952	−0.058	0.82
Nr. PES placement offers in last 6 months	1.688	1.970	−0.282	0.12	1.669	1.828	−0.159	0.33
Nr. PES placement offers in last 2 years	3.309	4.149	−0.840^**	0.02	3.275	3.697	−0.422	0.15
Last profession
Simple/basic services	0.070	0.058	0.012	0.30	0.067	0.064	0.002	0.83
Accomodation, food service	0.052	0.044	0.008	0.44	0.051	0.056	−0.005	0.61
Law	0.064	0.029	0.036^***	0.00	0.063	0.062	0.001	0.94
Production	0.514	0.517	−0.003	0.90	0.523	0.530	−0.008	0.74
Trade and sales	0.186	0.157	0.029	0.10	0.182	0.172	0.010	0.58
Last employment in the public sector	0.211	0.134	0.077^***	0.00	0.176	0.176	0.000	1.00
Unemployment insurance benefit daily rate
≤5 €	0.084	0.096	−0.012	0.37	0.086	0.087	−0.001	0.94
≤ 15 €	0.166	0.150	0.016	0.36	0.165	0.150	0.015	0.37
≤ 20 €	0.090	0.119	−0.029^**	0.05	0.094	0.088	0.005	0.69
Social assistance receipt³
Full receipt, single	0.100	0.097	0.003	0.82	0.101	0.094	0.007	0.61
Full receipt, no single	0.032	0.030	0.002	0.83	0.032	0.044	−0.011	0.21
Partial receipt, single	0.289	0.359	−0.070^***	0.00	0.281	0.285	−0.004	0.84
Partial receipt, no single	0.494	0.349	0.145^***	0.00	0.501	0.501	0.000	1.00
Balancing indicators
	Pseudo R²	P > χ²	Median bias
Before matching	0.245	0.000	10.4
After matching	0.022	0.977	2.1

Ø Effects of intensified counseling on the labor market position after 3 years

	Treated	Controls	Difference

	Case management	No case management	ATT

	Share in % / percentage point change		Absolute	Relative
Employed	49.1	48.5	0.7(3.4)	1.4
Apprenticeship	21.3	17.0	4.3(2.4)^*	25.2
Unsubsidized	5.8	4.9	0.9(1.4)	17.6
Subsidized in companies	3.7	2.3	1.4(0.9)^*	61.3
Supra-company apprenticeship training	7.2	6.9	0.4(1.9)	5.2
EAPQ	4.6	3.0	1.7(1.1)^*	56.8
Other active dependent employment	23.4	28.5	−5.1(2.9)^*	−18.0
1^st labor market	21.8	26.9	−5.1(2.9)^*	−18.9
Workers	13.9	17.1	−3.2(2.5)^*	−18.8
Employees	6.1	6.9	−0.7(1.8)	−10.5
2^nd labor market (SEEs/NEPs)	1.6	1.7	−0.1(0.8)	−3.2
Registered unemployed	14.2	16.9	−2.7(2.9)	−15.9
PES training	14.2	11.7	2.5(2.2)^*	21.7
Apprenticeship search	3.8	4.8	−1.0(1.7)	−20.9
Economically inactive	16.7	15.9	0.8(2.6)	5.3

Comparison of matching algorithms

	(1)	(2)	(3)
% loss to common support	5.0	7.5	2.1
Logit Pseudo-R², after¹	0.022	0.024	0.026
P > χ², after²	0.977	0.937	0.782
Median bias, after³	2.1	2.2	2.7
ATT (SE), employed	0.7(3.4)	1.6(3.5)	−1.4(3.5)
ATT (SE), dependent employed	1.7(3.5)	2.5(3.6)	−0.5(3.5)
ATT (SE), active dependent employed	−0.8(3.5)	−0.2(3.5)	−2.7(3.5)
ATT (SE), registered unemployed	−2.7(2.9)	−2.7(3.5)	−1.0(2.4)
ATT (SE), PES training	2.5(2.2)	1.5(2.7)	2.3(2.4)
ATT (SE), apprenticeship search	−1.0(1.7)	−1.0(1.6)	−1.0(1.3)
ATT (SE), other unemployment status	−0.5(1.0)	−0.6(1.4)	−0.7(0.9)
ATT (SE), economically inactive	0.8(2.6)	1.1(2.6)	1.9(2.4)

Selected summary statistics by treatment status

	Mean			t-test

	Treated	Controls	Diff.	p>\|t\|
Female	0.389	0.296	0.093^***	0.00
Age (in years)	18.147	18.595	−0.448^***	0.00
At least compulsory school	0.582	0.513	0.069^***	0.00
Austrian citizenship	0.275	0.194	0.081^***	0.00
Eligible for asylum (convention refugee)	0.468	0.416	0.052^**	0.03
Eligible for subsidiary protection	0.142	0.299	−0.156^***	0.00
Social assistance full receipt	0.478	0.356	0.122^***	0.00
Social assistance partial receipt	0.434	0.332	0.102^***	0.00
Previous unemployment duration (days)	519.010	455.550	63.460^***	0.00

Ø Effects of intensified counseling on meetings, job offers, and benefit sanctions in the year after entry into case management

	Treated	Controls	Difference

	Case management	No case management	ATT

	Share in % / Percentage point change		Absolute (SE)	Relative
Meeting
Share with meeting (%)	85.0	80.7	4.3(2.5)^*	5.3
Number of meetings	6.0	3.9	2.1(0.3)^***	53.6
Meeting interval	19.1	31.6	−12.6(1.7)^***	−39.7
Job offers
Share with job offer (%)	54.3	43.7	10.6(3.4)^***	24.2
Number of job offers	4.1	2.5	1.6(0.3)^***	63.9
Benefit sanctions
Share with sanction (%)	6.9	4.8	2.0(1.5)^*	42.2
Job or ALMP refusal	2.7	2.1	0.6(1.1)	28.8
Missed Appointment	6.1	4.1	2.1(1.4)^*	50.3

Ø Effects of intensified counseling on entries into ALMP measures in the year after entry into the case management

	Treated	Controls	Difference

	Case management	No case management	ATT

	Share in % / Percentage point change		Absolute	Relative
Total	85.1	84.4	0.7(2.7)	0.9
Employment measures	9.3	6.8	2.4(1.7)^*	35.6
Direct job creation in SEEs	5.1	3.3	1.8(1.3)^*	52.8
Direct job creation in NEPs	2.0	1.3	0.7(1.1)	56.1
Non-profit personnel leasing	1.9	1.8	0.1(1.0)	5.9
Qualification measures	81.6	78.8	2.8(3.1)	3.5
Vocational orientation	28.4	26.0	2.5(3.2)	9.5
Basic training	46.3	35.6	10.7(3.1)^***	30.0
Training and further education	6.9	5.8	1.1(1.9)	18.7
PES subsidies to apprenticeships	7.0	4.3	2.7(1.6)^*	63.5
Supra-company apprenticeship training	13.5	15.4	−1.9(2.6)	−12.3
EAPQ	6.9	7.9	−1.0(1.8)	−12.4
External counseling	40.3	42.4	−2.1(3.6)	−5.0