Enhancing the Effectiveness of Active Labour Market Policies

This publication reviews the recent evidence from programme evaluations on the effectiveness of active labour market policies (ALMPs) in helping unemployed individuals return to work. ALMPs differ widely in their objectives and their impacts, both across countries and within countries over time. Programme evaluations attempt to determine the impact of various ALMPs, both for the individual and on society at large. Individual impacts are usually measured in terms of post-programme earnings and/or employment performance. Societal impacts include an estimation of deadweight, displacement and substitution effects, along with some accounting for possible externalities. Recent evaluations suggest some ALMPs can help most groups of the unemployed. Many unemployed benefit from early intervention through the provision of counselling and job-search assistance. Others benefit through targeted employment subsidies, particularly in the private sector. The picture is more mixed with respect to ...