Do lower caseloads improve the effectiveness of active labor market policies?

Abstract

"We study how the caseworker to client ratio affects the success of active labor market policies that aim to bring job-seekers into employment. Although existing evidence is limited, caseload is a potentially important policy parameter that affects both the quality and the administrative costs of employment services. Exploiting a unique pilot project by Germany's federal public employment agency that hired additional caseworkers in 14 of its 779 local employment offices, we find that lower caseloads resulted in a decrease in the rate and duration of local unemployment and a higher reemployment rate. Offices with lowered caseloads became more proactive and imposed more sanctions on clients with low search efforts and registered more new vacancies. Cost-benefit computations suggest that the costs from hiring additional caseworkers was offset by the savings from decreased benefit expenditures after a period of about ten months." (Author's abstract, IAB-Doku) ((en))

Cite article

Hainmueller, J., Hofmann, B., Krug, G. & Wolf, K. (2011): Do lower caseloads improve the effectiveness of active labor market policies? New evidence from German employment offices. (LASER discussion papers 52), Erlangen, 35 p.