Do dedicated preparation measures improve the effectiveness of consecutive active labour market policy measures in Germany?

Abstract

There exists a large literature on the evaluation of specific active labour market policy measures. However, in Germany, unemployed workers often take part in several subsequent measures. By estimating the treatment effect of consecutive programme participation, this paper takes the interaction of programmes into account. Allowing for the combination of various measures with preparation and aptitude test measures, we shed some light on the value of ALMP measure combinations. Using rich administrative German labour market data, we are able to estimate the average treatment effect on the treated of the combined ALMP measures at different points in time. Our results suggest that the combination of measures only improves reintegration into the labour market in combination with wage subsidies. Compared to single measures, combinations are relatively ineffective. However, we can only observe the average treatment effect on the treated, there may be effects for specific groups of the unemployed.