Soft Skills or Hard Cash? The Impact of Training and Wage Subsidy Programs on Female Youth Employment in Jordan

By Matthew Groh, N. Krishnan, David McKenzie, T. Vishwanath. 2012

117 citations recorded by the source corpus.

Throughout the Middle East, unemployment rates of educated youth have been persistently high and female labor force participation, low. This paper studies the impact of a randomized experiment in Jordan designed to assist female community college graduates find employment. One randomly chosen group of graduates was given a voucher that would pay an employer a subsidy equivalent to the minimum wage for up to 6 months if they hired the graduate; a second group was invited to attend 45 hours of employability skills training designed to provide them with the soft skills employers say graduates often lack; a third group was offered both interventions; and the fourth group forms the control group. The analysis finds that the job voucher led to a 40 percentage point increase in employment in the short-run, but that most of this employment is not formal, and that the average effect is much smaller and no longer statistically significant 4 months after the voucher period has ended. The voucher does appear to have persistent impacts outside the capital, where it almost doubles the employment rate of graduates, but this appears likely to largely reflect displacement effects. Soft-skills training has no average impact on employment, although again there is a weakly significant impact outside the capital. The authors elicit the expectations of academics and development professionals to demonstrate that these findings are novel and unexpected. The results suggest that wage subsidies can help increase employment in the short term, but are not a panacea for the problems of high urban female youth unemployment.

Subfields: Economics and Econometrics, Gender Studies

View Paper: https://www.semanticscholar.org/paper/916b74d93e744295ef668da748cda82fa6bdb8c9

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Citations in the corpus

Active Labor Market Policies (2016, background): “Some programs even associate training programs that give access to soft skills with subsidized jobs (see Groh et al. 2012). little knowledge of the world of work and workers excluded from employment for a long period of time.”
A Helping Hand or the Long Arm of the Law? Experimental Evidence on What Governments Can Do to Formalize Firms (2013, unknown): “5.6 Comparing Actual Impacts to Expectations of Treatment Impacts A standard question with impact evaluations is whether they deliver new knowledge or merely formally confirm the beliefs that policymakers already have (Groh et al, 2012).”
Entrepreneurship Education and Entry into Self-Employment Among University Graduates (2016, background): “Only a few papers provide evidence of training impacts on behavioral skills, aspirations or attitudes, whilst also documenting impacts on labor-market or business creation outcomes (Groh et al., 2012; Macours et al., 2013; Solomon et al., 2013).”
Location, search costs and youth unemployment: experimental evidence from transport subsidies (2018, unknown): “Finally, my findings contrast with the existing literature that has found weak impacts of other active labour market policies on youth outcomes, particularly in developing countries (Betcherman et al., 2004; Groh et al., 2012; Ibarraran et al., 2014).”
The Impact of Vocational Training for the Unemployed: Experimental Evidence from Turkey (2014, unknown): “To address the issue of whether these impacts are in line with the expectations of both the individuals applying for ISKUR training courses and the policymakers in charge of these courses, we conducted an expectations elicitation exercise (Groh et al, 2012).”