Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/278919 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16221
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper estimates experimental impacts of a supported work program on employment, earnings, benefit receipt, and other outcomes. Case managers addressed employment barriers and provided targeted financial assistance while participants were eligible for 30 weeks of subsidized employment. Program access increased employment rates by 21 percent and earnings by 30 percent while participants were receiving services. Though gains attenuated after services stopped, treatment group members experienced lasting improvements in employment stability, job quality, and well-being, and we estimate the program's marginal value of public funds to be 0.64. Post-program impacts are entirely concentrated among participants whose subsidized job was followed by unsubsidized employment with their host-site employer. This decomposition result suggests that encouraging employer learning about potential match quality is the key mechanism underlying the program's impact, and additional descriptive evidence supports this interpretation. Machine learning methods reveal little treatment effect heterogeneity in a broad sample of job seekers using a rich set of baseline characteristics from a detailed application survey. We conclude that subsidized employment programs with a focus on creating permanent job matches can be beneficial to a wide variety of unemployed workers in the low-wage labor market.
Subjects: 
subsidized employment
active labor market programs
randomized controlled trial
JEL: 
J24
J68
I38
H43
Document Type: 
Working Paper

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