Hugo Sinzheimer Institute University of Amsterdam

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Hugo Sinzheimer InstituteUniversity of Amsterdam

• Early Interventions through
• Work-based Programs
• Work First Benchmark 2007
• The Netherlands
• Julie Castonguay
• J.Castonguay_at_uva.nl
• WAPES and AMS Benchmarking Thematic Day
• European Strategies on Early Interventions
• Vienna, 5-6 May 2008

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Trends in labour market policies in EU welfare
states

• From. passive labour market policy
• Benefits for income replacement,
• Unemployment Insurance and Social Assistance
• To. Active Labour Market Policies (ALMP)
• Education and Training for the unemployed
• Human Capital approach
• To. Activating labour market policies
• Incentives to take-up employment
• Mandatory participation in programs
• Focus on active participation of claimants in
  their efforts to find a job

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Definition Work First

• What do we mean with work-based programs and with
  Work First in the Dutch context?
• A strategic policy, implemented from the start of
  the claim for social assistance,
• focused on prevention, enforcement of rights and
  duties, diagnose through work-test,
• where the objective is the return to work as soon
  as possible,
• making use of three types of instruments
  work-activities, employability-activities, and
  sanctions

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Work First strategy
t1 ? t2
t1
t2
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Context Reform of Social Security in 2002/2004

• SUWI (2002) on the implementation structure of
  social security
• WWB (2004) on Social Assistance
• ? Major changes privatization and
  decentralization
• Effectiveness increased focus on impacts of
  programs
• Efficiency competition between private providers
• Client-oriented service provision choice is
  possible

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Context Exit rates after two years in Social
Assistance (2003)
Total claimants 390 040 No exit within 2
years 275 960 (71) Exit to work 31 230 (8)
Source CBS, 2005, Uitstroom naar werk.
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Context Exit rates after two years in
Unemployment Insurance (2003)
Total claimants 161 130 No exit within two
years 51 650 (32) Exit to work 51 250 (32)
Source CBS, 2005, Uitstroom naar werk.
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Context Odds of finding a job Social
Assistance, with/without (early) intervention
No intervention Early intervention Intervention
after 6 months Intervention after 12 months
(source SEO 2006)
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The rise of Work First in the Netherlands

• From Suitable Work to Generally accepted work
• New financial incentives for municipalities,
  towards increasing outflow and decreasing inflow
• Possibility to make use of private providers
• Evidence that early-intervention works
• Evidence that work-based employment programs
  works, mostly influenced by US, UK and Danish
  programs.
• ? Situation in 2005, 80 of municipalities say
  they have implemented some form of Work First.
  But, no centralised collection of data/evidence
  of success/failures.

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Work First Benchmark 2007

• Commissioned by Divosa, the association of the
  directors of social affairs departments in Dutch
  municipalities.
• 49 Work First projects participate in the
  benchmark, from 78 municipalities
• Objectives of the benchmark
• Asses the degree of variation between the
  projects
• Asses the performance of the projects
• Find out the determinants of success
• Allow projects to compare their design and their
  results with each other, and learn from
  best-practices

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Policy choices within Work First

• Target group all claimants, only young
  unemployed, only new claimants (early
  intervention only)
• Sanctions partial reduction or complete
  withdrawal of benefit
• Type of work-environment regular labour market
  or simulated work-place
• Number of hours in work-activities, and type and
  number of hours for employability-activities
• Rewards work-for-benefit, or regular salary
• Service provider municipality,
  sheltered-workplace or private provider

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Results of Work First

• On average, the impact of the 49 Work First
  projects was
• Inflow prevention 33
• Outflow to work 45

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Impact Work First Target group by claim-length
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Impact Work FirstTarget group by age
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Impact Work First Type of Sanction
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Impact Work First Type of Work-environment
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Impact Work First Type of Reward
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Make or buy? Head-contractor of Work First
projects
  Head-contractor of Work First (in )
 
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Impact Work First Type of Head-contractor
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Impact Work First

• For a high level of inflow prevention
• Young unemployed and new claimants for target
  group
• Simulated working-environment
• Municipality as head-contractor of project
• Only benefits as a reward
• Withdrawal of benefit as sanction policy
• For a high level of outflow to work
• Young unemployed and new claimants for target
  group
• Real working-environment
• Municipality or Private provider as
  head-contractor of project
• Temporary reduction in benefit as sanction policy

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Negative effects of Work First

• Focusing only on work, not taking into account
  salary or job security, can lead to working
  poor
• It can also lead to a revolving-door effect,
  where individuals alternate periods of (low paid
  and insecure) work with claiming social
  assistance benefits.

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Conclusions

• Decentralization created a laboratory for
  different kinds of approach to Work First
• The short-term results are good, little is known
  now about impacts on the long-term
• Balancing focus on work with an aim at increasing
  employability is crucial for the long-term.
• Balance between carrots and sticks, sanctions and
  provisions.