Human well-being and in-work benefits : a randomized controlled trial

Many politicians believe they can intervene in the economy to improve people’s lives. But can they? In a social experiment carried out in the United Kingdom, extensive in-work support was randomly assigned among 16,000 disadvantaged people. We follow a sub-sample of 3,500 single parents for 5 ensuing years. The results reveal a remarkable, and troubling, finding. Long after eligibility had ceased, the treated individuals had substantially lower psychological well- being, worried more about money, and were increasingly prone to debt. Thus helping people apparently hurt them. We discuss a behavioral framework consistent with our findings and reflect on implications for policy

The Jobseeker’s Allowance Skills Conditionality Pilot

"The Jobseeker’s Allowance (JSA) Skills Conditionality Pilot was launched in April 2010 with the aim of exploring the labour market effects of mandating participation in training. The pilot targeted JSA claimants entering stage 3 of the Jobseeker’s Regime and Flexible New Deal (JRFND) who had an identified skills need. It was based on a random assignment design whereby the requirement to participate would be imposed on the basis of National Insurance number (NINO) to half of those referred to training. If carried out effectively, differences revealed through a comparison of outcomes post-randomisation can be viewed as being caused by the conditionality. This report presents the findings from two parallel studies of the pilot. The quantitative analysis used administrative data to provide details on the implementation of the pilot and whether it could be used to provide valid estimates of the impact of mandation. The qualitative analysis explored the experiences and views of participants in the pilots: principally mandated claimants and Jobcentre Plus advisers, but also training providers" -- page 1

State dependence, duration dependence and unobserved heterogeneity in the employment transitions of the over-50s

This paper examines employment transitions among men and women in the UK aged between 50 and the state pension age. We begin by examining the issue of duration dependence, using standard duration models. We then use a fourth order Markov model to estimate quarterly transitions while allowing for potential endogeneity of initial conditions. The results reject exogeneity of initial conditions and show the importance of both duration dependence and state dependence. This implies there is the potential for any individual to become trapped in non-employment and, ideally, policy should intervene as soon as an individual begins a period of non-employment.Labour market participation, Transitions, Over-50s.

The new deal for young people: effect of the options on the labour market status of young men

The New Deal for Young People was introduced throughout Great Britain in April 1998 as a key element of the government’s welfare-to-work strategy. Participants enter a period of intensive job search known as the ‘Gateway’ and then enter one of four options. In this paper, the relative effectiveness of these options on unemployment exit and job entry is evaluated. The evaluation uses a non-parametric matching approach and finds that the employment option dominates the other NDYP options. Remaining on the Gateway appears more effective than entering the remaining options. The relative strength of these effects changes over time.

The effect of temporary in-work support on employment retention: evidence from a field experiment

A recent experimental programme for unemployed welfare recipients in the UK found that temporary earnings supplements combined with post-employment services led to a sustained rise in employment. This paper examines whether this was due to increases in employment entry or to reductions in employment exit. Using a hazard rate model, we find a significant effect on initial employment entry but not on subsequent transitions. The results also show that the length of a completed unemployment spell has a negative effect on the hazard of exit from the next unemployment spell. While the direct effect of the programme is to shorten the initial unemployment spell, an indirect effect arises due to this lagged duration dependence

The impacts of pre-apprenticeship training for young people

Apprenticeships are the key means by which the UK government aims to build skills and tackle the problem of youth unemployment. However, not all young people are able to secure an apprenticeship. Traineeships, a voluntary six-month programme of work placements and work preparation training, were introduced in England in 2013 to help equip young people with the skills and experience required to secure an apprenticeship or employment. The analysis in this paper uses linked administrative data on the population of trainees and a comparison sample of non-trainees to evaluate the impact of the programme on employment and apprenticeships. It uses a local instrumental variable approach, which allows selection into a traineeship to be influenced by unobserved preferences and for impacts to vary according to these preferences. The heterogeneous impacts can be aggregated to form an estimate of the average impact of treatment for all participants. The results show no overall impact on employment for younger trainees (16-18 year-olds) but an across-the-board positive impact on the probability of becoming an apprentice. For older trainees (19-23 year-olds), no significant impact on either employment or apprenticeships is evident among participants as a whole but the results suggest that, for those more resistant to participating, traineeships may actually reduce the probability of becoming an apprentice. These results confirm the effectiveness of traineeships as a means of facilitating apprenticeships among younger people. As such, they support the policy target of achieving 3 million apprenticeships by 2020

A Multi-Level Analysis of the Impacts of Services Provided By the UK Employment Retention and Advancement Demonstration

Background: The United Kingdom Employment Retention and Advancement (U.K. ERA) demonstration was the largest and most comprehensive social experiment ever conducted in the United Kingdom. It examined the extent to which a combination of postemployment advisory support and financial incentives could help lone parents on welfare to find sustained employment with prospects for advancement. ERA was experimentally tested across more than 50 public employment service offices and, within each office, individuals were randomly assigned to either a program (or treatment) group (eligible for ERA) or a control group (not eligible). Method: article presents the results of a multilevel nonexperimental analysis that examines the variation in office-level impacts and attempts to understand what services provided in the offices tend to be associated with impacts. Result: The analysis suggests that impacts were greater in offices that emphasized in-work advancement, support while working and financial bonuses for sustained employment, and also in those offices that assigned more caseworkers to ERA participants. Offices that encouraged further education had smaller employment impacts. Conclusion: Plausible results are obtained identifying those particular implementation features that tended to be linked to stronger impacts of ERA. The methodology employed also allows the identification of which services are associated with employment and welfare receipt of control families receiving benefits under the traditional New Deal for Lone Parent program