Unemployment Duration Before and After New Deal

Abstract

A major active labour market policy - the New Deal for Young People (NDYP) - was introduced throughout the UK in 1998. We examine its effects on unemployment duration by estimating hazard functions for unemployment outflows before and after its introduction. We add value to existing evaluations in the following ways. First, we examine previously unused administrative data for Northern Ireland. Second, we examine NDYP effects at all unemployment durations. Third, we estimate separately by gender. Fourth, exits to employment, education and training and other benefits are identified separately. Since NDYP's introduction, young people are 25-50% less likely to experience year-long unemployment spells, with increased probabilities for all types of exit. NDYP is intended, however, to largely eradicate long term youth unemployment. We ask why this has not been the case in Northern Ireland.unemployment duration, new deal, hazard functions, young people