Research project TA/00/11 (Research action TA)
Since 1 July 2004 a new follow-up system of unemployed benefit claimants has been in effect in Belgium. On the one hand, the new system is designed to foster job-seeking, vocational training supply and other active policy measures. On the other, the efforts to find work are more closely monitored and sanctions will be applied if these efforts are insufficient. Recent micro-economic evaluations in other countries conclude that this type of policy might be very effective in stimulating the return to employment of participants. Such a conclusion is significant if account is taken of the rather weak effects of most evaluated active policy measures. This research aims to verify whether these positive conclusions likewise apply in Belgium.
The implementation of such a system affects more than just the path of its beneficiaries. The job-seeking behaviour of those not taking part may also be affected by the follow-up system. The same applies in respect of decisions to open up vacant positions and of wage formation. Furthermore, the financing of the policy would also engender changes of behaviour. The literature indicates that these induced effects might be considerable, to the point of sometimes inverting the conclusions of evaluations that limit themselves to the impact on the beneficiaries. In a second step we will analyse these induced effects using a calibrated general equilibrium model representing the frictions on labour markets in an imperfect competition setting.
The first part will study the impacts on participants paying due attention to the nature of employment. We will focus on a certain number of characteristics which are generally ignored in the literature. First of all, a positive effect on the access to employment may be observed to the detriment of the quality of that employment. We will ask in particular whether, and to what extent, the follow-up system for job-seekers promotes part-time employment rather than full-time employment, low-wage jobs rather than well-paid jobs, unstable jobs rather than stable jobs. The follow-up system is also designed for the long-term unemployed (according to the age of the unemployed person, the call to the first interview comes 15 or 21 months after the onset of unemployment and receipt of benefit). The short-term unemployed may avoid being called since the Federal Unemployment Service (RVA/ONEm) informs them by letter 3 to 8 months in advance of their obligations. Their respect of these obligations is controlled during the first interview. We will verify whether this phenomenon of anticipation is important. Finally, the new follow-up system consists of a sequence of actions: calls to interview, proposals to participate in active policy measures, sanctions, etc. We will attempt to break down the overall effect in its various components.
The second part of the research will examine the induced effects of the follow-up system with reference to a number of indicators, namely the job-seeking effort of non-participants, the wages and salaries and the number of vacant positions. To that end this part of the research will construct a general equilibrium model with frictions on the labour market. These will be taken into account via a matching function. This model will rely on hypotheses which are relevant for Belgium. Particular account will be taken of institutions which are present on the labour market (for example, those involved in wage negotiations). It will further introduce several sources of heterogeneity between the economic agents (at least the various levels of educational attainment and the main categories for determining unemployment benefits). The calibration of the model will be based as far as possible on the individual data collected within the context of the first part of this project. The model will then be simulated in order to quantify the effects of the new follow-up system on the position of the different groups identified by the model.
Evaluation de l’activation du comportement de recherche d’emploi : rapport final + annexes
Cockx, Bart - Dejemeppe, Muriel - Van Der Linden, Bruno Gent : Academia Press, 2011 (PB6275)
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Evaluation of the activation of job-seeking behaviour: summary
Brussels : Scientific Policy, 2011 (SP2253)
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Evaluation de l'activation du comportement de recherche d'emploi: résumé
Bruxelles : Politique scientifique fédérale, 2011 (SP2255)
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Evaluatie van de activering van het zoekgedrag naar werk: samenvatting
Brussel : Federaal Wetenschapbeleid, 2011 (SP2256)
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