The Effects of Active Labor Market Policies for Immigrants Receiving Social Assistance in Denmark

We estimate the effect of active labour market programs on the exit rate to regular employment for non-western immigrants in Denmark who receive social assistance. We use the timing-of-events duration model and rich administrative data. We find large positive post program effects, and, surprisingly, even most in-program effects are positive. The effects are largest for subsidized employment programs, but effects are also large and significant for direct employment programs and other programs. The effects are larger if programs begin after six months of unemployment. Implications of our estimates are illustrated by calculating effects on the duration to regular employment over a five-year period.

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Location: Denmark

Groups: Immigrants/Newcomers
Keywords: Employment RatesWage SubsidySocial AssistancePolicy ImplicationParticipationNewcomersLabor Market PoliciesLabor Market Attachment