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Success factors in early activation and case management MISEP meeting, Paris, 3-4 November 2008

Success factors in early activation and case management MISEP meeting, Paris, 3-4 November 2008. David Grubb Employment Analysis and Policies Division, OECD. 1. At the start of a spell. Initial registration.

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Success factors in early activation and case management MISEP meeting, Paris, 3-4 November 2008

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  1. Success factors in early activation and case managementMISEP meeting, Paris, 3-4 November 2008 David Grubb Employment Analysis and Policies Division, OECD

  2. 1. At the start of a spell

  3. Initial registration • Jobseeker’s name, contact details and other basic information e.g. previous employer and start date of unemployment are recorded • In most OECD countries, a benefit claim is conditional on (or automatically involves) registration with the employment service. Some variations: • CA and for at least 1 month IE accept benefit claims without registration for employment. • In LU, NL, ES some days of benefit can be paid retroactively, i.e. for unemployment before the client was registered for placement • In about half the OECD countries, benefits are paid only after a waiting period (often 4 to 7 days) - allowing several days to match the client to a job vacancy before benefit entitlement starts

  4. About half of the OECD countries propose job vacancies to some clients at initial registration. In the UK 12% of first contacts (initial registration with the telephone call centre) result in a submission for a job, and 0.9% result in a job entry. Immediate referral to job vacancies

  5. Detailed registration interviews • These traditionally registers the jobseeker’s work history, occupational qualifications, and professional ambitions, providing a basis for active matching of jobseekers to job vacancies. • In many countries now also used to set up an IAP • Detailed registration usually takes place: • In AU, AT, JA, KR, NL, PT, SK, at initial registration. • In CZ, FR, GR, NZ, UK, a week or less after initial registration. • In DK, FI, DE, LU, NO, ES, SE, CH, US, after more than week but less than month. • Longer delays may permit cost savings, since some claimants find jobs rapidly and never reach the detailed registration interview.

  6. Other functions of early client contact • Take in documentation for a benefit claim (e.g. income and housing information, for means-tested benefits). • Deliver information on the PES resource offer (job vacancies, CV preparation, vocational guidance, training options, etc). • Deliver information on jobseeker “rights and responsibilities”, perhaps requiring signed acknowledgement • Deliver a job-search diary, to be returned later in the unemployment spell. • Agree restrictions on availability or the field of job-search (by occupational field, travel to work area, etc.) – often limited to the early months of unemployment • Agree other elements in an individual action plan.

  7. Long-term unemployed and labour market re-entrants (lone parents, disabled..) • For disadvantaged job-seekers, procedures should not necessarily focus on rapid job matching. Initial interviews may focus on the client’s work aspirations and the identification of barriers that have prevented taking up work until now.

  8. 2. Regular contacts

  9. What countries do • Reporting to the PES with in-person attendance is required usually weekly in AT, every two weeks in AU, CZ, LU, PT, SK, UK, monthly in GR, HU, IE, JA, CH and quarterly in ES (in other countries, regular reporting is not in person, or does not follow a regular schedule). • In most countries regular reporting is to the PES (in IE, to a separate benefit administration). Its functions can include: (a) Reporting days worked during the last benefit period and confirmation of continuing unemployment and benefit claim (b) Jobseeker reporting of job-search efforts (c) Placement counselling e.g. presentation of job vacancies • Common alternative arrangements include • for (a) reporting and confirmation by post, telephone or internet • for (b) verification of job-search efforts through in-person interviews at infrequent intervals (e.g. once/twice a year) • for (c) more-intensive but less-frequent interviews with case-workers, e.g. once every 3 months

  10. The impact of regular contacts • Evaluations usually report that regular interventions e.g. job-search monitoring and employment counselling, have an impact on rates of job-finding or exit from benefits. • Direct referrals to vacancies are plausibly another key technique shortening spell durations: in AT, CH, the PES makes 6 to 8 referrals per unemployed person per year. • PES contact and monitoring schedules are often applied at all durations of unemployment, but some countries start them only after 3-4 months (perhaps dependent on profiling at initial registration) or relax them after 12+ months. • Intensive intervention from the start of the spell is expensive, due to the high level of short-term inflows. • Unemployment spell durations of up to a few months may be socially optimal, and not necessarily call for intervention. • Job-search assistance may not be very productive for some short-term unemployed (who can search effectively without assistance) or some long-term unemployed (with severe barriers to employment).

  11. 3. Factors influencing success • Benefit generosity • Counsellor qualifications and experience • Centralisation/decentralisation

  12. Benefit generosity • Activation strategies differ between countries with high long-duration benefits and those with lower benefits. • In CA, JA and US, UI benefits are limited to 6 months (up to a year in exceptional cases) and rarely involve programme participation requirements. • The main activation measure is job-search monitoring, and even this is not intensive in Canada or Japan, and variable across states in the US. • Other English-speaking countries (AU, IE, NZ and UK) pay assistance benefits at an intermediate rate (c.50% net replacement rate, for people who earn 100% of the Average Wage when in work). • These countries “activate” the unemployed mainly through PES contacts, ranging from job-search monitoring to intensive case management/action plans. Spending on other ALMPs is particularly low in AU, UK.

  13. Benefit generosity (2) • North/West-Central European countries (DK, FI, SE, NL, LU, CH) pay long-duration wage-related benefits (or sometimes assistance benefits after 1 year) with a high replacement rate. Significant programme participation requirements seem necessary to limit unemployment : • Spending on ALMPs is high, about 1% of GDP on average. • Some studies from FI, NL have reported little evidence of impact from PES contact regimes • Denmark’s “mandatory activation” programme had a large impact, but it involved programme participation after 4 months • Sweden’s Activity Guarantee introduced in 2000 (now the Employment and Development Guarantee), requires full-time participation in supervised job-search activities • Countries that deviate from their neighbours’ practices, e.g. IE, NO, tend to experience corresponding differences in outcomes

  14. Benefit generosity (3) • These international comparisons suggest that both active measures and fairly modest changes in benefit generosity (e.g. replacement rates of 65% rather than 50%) have a significant impact on outcomes. • Employment service providers report this also from micro-level experience, e.g. “ Client motivation is often the key to success in achieving employment. If an individual is not going to be financially better off in work, their motivation to leave benefits will be significantly reduced.” (Work Directions, 2008).

  15. The quality of case management affects outcomes significantly • At service-provider level: in 1998 Australia replaced the public employment service with a network of private providers. There was at first wide variation in outcome rates across providers. The elimination of poor performers in subsequent tendering rounds (2000, 2003) led to convergence in provider strategies and improvements in aggregate outcomes. • At case-worker level: Behncke et al. (2007) using statistics that link jobseeker and case-worker records, found many case-worker factors that influence re-employment rates: case-worker specific training and experience act positively, case-worker age negatively, etc.

  16. Decentralisation (pros and cons) • Arguments for decentralisation: • Decentralisation allows strategies to be adapted to local conditions. • When the person doing a job (e.g. local office manager) knows it best, a strict regulatory framework or “micro-management” reduces productivity. • However, extensive local autonomy results in: • Local variation exceeding what can be justified as adaptation to local conditions (driven more by the idiosyncratic ideas of individual managers, local politics and historical choices). • Absence of management information, because statistics are not comparable when the underlying procedures differ, resulting in loss of accountability.

  17. Optimal decentralisation • Considerations include: • Incentive compatibility, i.e. if benefits are financed by national funds, but regional or local bodies control employment services or benefit administration, they lack a direct incentive to reduce unemployment. • Standardisation of some key functions e.g. IT systems, outcome reporting standards (e.g.for vacancies, placements), definitions of jobseeker rights and responsibilities. • An institutional framework allowing the measurement of outcomes on a comparable basis – this is important for the efficiency of “quasi-market” provision. • Staff qualifications e.g.for counsellor grades hired at less-than tertiary level, greater standardisation (central definition and regulation) of case-management procedures may be appropriate.

  18. References • Forslund, S., D. Froberg and L. Lindqvist, “The Swedish Activity Guarantee”, SEM Working Paper no. 16 (www.oecd.org/els/workingpapers) • Graversen, B and J. Van Ours (2006), “How to Help Unemployed Find Jobs Quickly: Experimental Evidence from a Mandatory Activation Program”, IZA Discussion Paper no. 2504. • Grubb, D. (2007), “Labour Market Policies at Different Benefit Replacement Rates”, Thematic review on Modernising and activating benefit and social protection systems to promote employment, Brussels, 28 March (www.mutual-learning-employment.net) • OECD (2005), “Labour Market Programmes and Activation Strategies: Evaluating the Impacts”, Employment Outlook (www.oecd.org/els/employment/outlook - previous editions). • OECD (2007), “Activating the Unemployed: What Countries Do “, Employment Outlook, Chapter 5 and “Compendium of National Replies to the OECD Questionnaire on Interventionsin the Unemployment Spell”. • Work Directions (2008), International Insights, Ingeus Centre for Policy and Research (www.workdirections.co.uk). • Behncke, S., M. Frölich and M. Lechner (2007), “Characteristics of Employment Offices and Individual Reemployment Chances: Some Empirical Results for Switzerland”, paper for the Conference on Evaluation of Active Labour Market Policies for Operational Purposes, Nuremberg, June 12-13.

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