Compensation or competition: Bias in immigrants' access to active labour market measures

Abstract

Whether participation in active labour market programmes (ALMPs) pushes individuals back into employment depends on the programme's characteristics. On the basis of encompassing registry data that allow us to control for usually unobserved employability, we find evidence of a systematic access bias whereby jobcentre caseworkers in Switzerland assign unemployed persons to activation measures based on a competition logic that is mainly driven by an economic rationale and the jobcentre's performance evaluation. This practice seems problematic because it results in an overrepresentation of immigrants in measures with little efficacy rather than in measures that could compensate for employability disadvantages. Conversely, Swiss citizens are more likely to enter beneficial humancapital-intensive measures. It is plausible that this discrepancy in programme participation amplifies the general labour market disadvantages of immigrants. K E Y W O R D S access bias, active labour market policy,

Participation in labour market programmes: A positive or negative signal of employability?

“…Although certification might matter less for low-skilled positions, documentation of formal qualifications might still be important, as suggested by the following quote:If the PES would say we have paid a ‘SIZ’ [specific computer course] or a ‘BEC’ [language diploma] or an ‘Alliance Français’ [language diploma] or something like that, then this has more weight for me (Retail16CH).Overall, our findings regarding training suggest that these programmes are valued only if they are perceived to provide knowledge that is directly relevant to the job, and are mostly interpreted according to their substantive effect. This was found to especially apply to migrants because, for these jobseekers, the training programmes might compensate for any disadvantage they might experience due to discrimination (Auer and Fossati, 2019). Our findings showed that in the low-skilled sector, training programme participation was almost never interpreted as a positive signal of motivation but hardly ever as a negative signal of a lack of skills.…”

“…Participation in TEPs might be especially valued in the low-skilled labour market segment when employers assume voluntary participation, as this signals a willingness to engage in unrewarding and repetitive activities that are typical of these occupations. Often, however, caseworkers use TEPs as a sanctioning device when clients do not comply with job search requirements (PES Interview 2; Auer and Fossati, 2019; Duell et al, 2010; Filges and Hansen, 2017). 4 Consequently, employers who believe that TEPs are assigned to sanction recalcitrant jobseekers use participation to identify potentially unproductive candidates.…”

“…Tellingly, these strategies are also referred to as ‘parking strategies’ (Martin, 2000: 196). However, these programmes can serve as frameworks to structure the jobseeker’s day and provide networking opportunities (Auer and Fossati, 2019; Bonoli, 2013; Duell et al, 2010).…”

Individual need and societal claims: Challenging the understanding of universalism versus selectivism in social policy

“…Rudolf Meidner and Gösta Rehn constructed the variant of active labour market policy that together with the general welfare state formed what is known as the Swedish model (Erixon, 2010, 2011). This version of ALMP, aimed at compensating skill lacunas of the least employable jobseekers, has been referred to as compensation logic in contrast to competition logic , which targets those jobseekers who are easiest to employ (Auer & Fossati, 2019).…”

Immigrant integration and social investment

“…Some immigrant groups may lack these capabilities, and will as a result be excluded from participation. In addition, immigrants’ access could also be biased by the caseworker’s anticipation of labour market discrimination (Auer and Fossati, 2019). If caseworkers know that a given jobseeker is unlikely to find a job regardless of actual skills and because of employer discrimination, they may decide not to invest in their human capital.…”