Evaluation of the Australian Wage Subsidy Special Youth ...

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66 Table 2.11 Unemployment, labour force participation and employment rates, teenagers and total working age population March 1983 and March 1988. Rate as percent 15-19 All working age male female all male female all March Unemployment 23.2 25.6 24.3 9.9 11.2 10.4 1983 Labour force 63.9 59.8 61.9 77.3 45.6 61.3 participation Employment 49.1 44.5 46.9 69.6 40.5 54.9 School 35.2 40.0 participation In school Unemployment 28.7 24.9 Labour force 20.0 23.5 participation Employment 14.3 17.6 Out of school Unemployment 22.5 25.7 Labour force 87.8 80.2 participation Employment 68.0 59.6 March Unemployment 18.2 21.2 19.7 7.3 9.1 7.5 1988 Labour force 61.9 60.0 61.0 76.2 50.9 63.3 participation Employment 50.6 47.3 49.0 70.6 46.3 58.2 School 40.9 41.3 participation rate In school Unemployment 20.8 21.4 Labour force 26.3 34.4 participation Employment 20.8 27.0 Out of school Unemployment 17.7 21.1 Labour force 86.3 78.0 participation Employment 71.1 61.5 Source: Ross (December 1988) p2 table 1 citing ABS Cat 6203.0 Labour Force Australia March 1983 and March 1988. Also, selected statistics from Ross (December 1988) p5 Table 3 and p 12 Table 5. In concluding, Ross (1988) examined the value of unemployment benefits for teens. In the context of the value of benefits relative to prices and average weekly earnings, it was found that the real value of unemployment benefits had fallen only for those 16-17 years. The value of benefits relative to prices and average weekly earnings is shown in Table 2.12. Webster (1997b) p10 modelled the Beveridge curve of Unemployment-Vacancies
67 for Australia using data from the period 1978-1997. This analysis found that the ratio of unemployment benefits to minimum award wages was an important shift variable of the Beveridge curve, with a rise in the ratio of benefits to wages raising the unemployment rate. The relative values of employment and unemployment activities in the labour market seem to have been detrimentally influencing youth labour participation. Table 2.12 Value of unemployment benefits to youths 1983-1987 16-17 years 18-20 years Benefits /CPI Benefits /AWE Benefits /CPI Benefits /AWE 1983 100.0 100.0 100.0 100.0 1984 106.3 105.3 108.0 106.8 1985 101.8 97.8 114.0 109.6 1986 103.6 104.8 113.5 115.1 1987 94.6 100.9 107.2 114.8 Source: Ross (December 1988) p14 CPI is the Consumer Price Index for all goods weighted average for 8 capital cities ABS Cat 6401.0. AWE is average weekly earnings from annual survey of earnings. Paterson and Mackay (1982) note that the share of youths aged 15-20 years in public sector employment suffered a large fall of 33 per cent from 1971 to 1981. Over the same period, public sector employment grew strongly by 29 per cent whereas private sector employment rose by only 8 per cent across this period, and in 1981 public sector employment was 30 per cent of total employment (Paterson and Mackay (1982): 28). A large part of this was likely due to the public sector refocusing employment towards graduates and skilled workers rather than taking on school-leavers and allowing 'working-up-the-ranks'. This would have led to a contraction in what was a substantial part of the youth employment market. The role of relative labour costs can have particular relevance to the operation of a wage subsidy. Windshuttle (1985) presented statistics for the ratio of average hourly earnings for adults relative to juniors, see Table 2.3 earlier. In 1983, for full-time private sector employees the ratio of average hourly earnings for adults relative to juniors was 52.7 for males and 63.4 for females. For females, this was a fall in the ratio from 66.6 in 1977, while for males it was also a fall but from 55.2 in 1977. Windshuttle (1985) p6 notes that public sector wages were higher than those for private sector over the same period. Windshuttle (1985) also observed that there was a greater difference in relative hourly
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i Evaluation of the Australian Wage
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v Declaration I hereby declare that
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in method and assumptions. The orth
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3.3 Data and variables used for est
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List of Tables and Figures Figure 1
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Table A2.0b Univariate Probit of pa
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xv Abstract The job subsidy Special
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1 1: Wage subsidy theory and evalua
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3 programs of providing benefits an
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5 The empirical methods used for th
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7 how the outcomes from these metho
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9 employment effect could be mainly
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11 Real Wage Employment Figure 1.1:
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13 are two types of unemployment, s
Page 31 and 32: 15 Real wages are predetermined whe
Page 33 and 34: 17 Vella (1998), Heckman, Lalonde a
Page 35 and 36: 19 Each individual has two potentia
Page 37 and 38: 21 this case, if there was no data
Page 39 and 40: 23 correlation for the error of the
Page 41 and 42: 25 Table 1.3 collects together some
Page 43 and 44: 27 Table 1.3 Brief overview of rece
Page 45 and 46: 29 necessarily brief. Then, the evi
Page 47 and 48: 31 limited applications, such as fo
Page 49 and 50: 33 who participated. It was conclud
Page 51 and 52: 35 term unemployed for over 12 of t
Page 53 and 54: 37 importance of the subsidy second
Page 55 and 56: 39 differences in characteristics t
Page 57 and 58: 41 Matching methods are theoretical
Page 59 and 60: 43 2.2 SYETP implementation As SYET
Page 61 and 62: 45 In July1978, the subsidy was cal
Page 63 and 64: 47 In January 1979, variations were
Page 65 and 66: 49 benefits were paid at a slightly
Page 67 and 68: 51 2.2.3 SYETP operation Earlier re
Page 69 and 70: 53 ceiling constraints’ applied t
Page 71 and 72: 55 Award Conditions for employment
Page 73 and 74: 57 Harris (2001) claims that during
Page 75 and 76: 59 display boards listed details of
Page 77 and 78: 61 restriction was used. If there w
Page 79 and 80: 63 to the end of the 1980’s. An o
Page 81: 65 for teens overall had risen, emp
Page 85 and 86: 69 training, can provide a form of
Page 87 and 88: 71 employer survey estimates were t
Page 89 and 90: 73 provisions for SYETP and extende
Page 91 and 92: 75 withdrawals occurred at similar
Page 93 and 94: 77 Table 2.17 State usage of progra
Page 95 and 96: 79 2.3.1 Stretton (1982, 1984) 53 S
Page 97 and 98: 81 Stretton attributed the success
Page 99 and 100: 83 included in the employment model
Page 101 and 102: 85 completers. Their argument was t
Page 103 and 104: 87 was an issue for the data. Unlik
Page 105 and 106: 89 Table 2.21 Richardson (1998) Est
Page 107 and 108: 91 2.3.5 General discussion Some ge
Page 109 and 110: 93 Controlling for differences in i
Page 111 and 112: 95 taken by a previous researcher a
Page 113 and 114: 97 If employability is assumed to b
Page 115 and 116: 99 suitability of the underlying as
Page 117 and 118: 101 Heckman, Lalonde and Smith (199
Page 119 and 120: 103 effect on employment relative t
Page 121 and 122: 105 Table 3.1, Part A Employment eq
Page 123 and 124: 107 (-1.80) (-1.80) Tradesperson -0
Page 125 and 126: 109 duration of Pre-June 1984 unemp
Page 127 and 128: 111 4: Study 2 Propensity score mat
Page 129 and 130: 113 Propensity score matching provi
Page 131 and 132: 115 4.2 Propensity score matching m
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117 covariates that influence the a
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119 (7) E(Y c | D=1) = E P(X) {E[Y
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121 For CIA to be plausible, a ‘r
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123 employment and programme partic
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Highest qualification in 1984 (1.56
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127 4.6 Distribution of the propens
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129 Figure 4.3 Histograms of estima
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131 Table 4.5 Summary statistics fo
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133 Table 4.5, that the variance of
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135 Table 4.6 Matching results, Sin
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137 Table 6.3 using Swedish data wi
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139 matching is the ability to weed
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141 Table 4.7 Matching results, All
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143 the unobserved component. If th
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145 5: Study 3 Attrition and non-re
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147 occur by design, because the mi
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149 (1990) extended and improved th
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151 (10) A* = δ 0 + δ 1 x +δ 2 z
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153 again from September to Novembe
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155 5.5.2 Univariate examination of
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157 lower, the job lengths are only
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159 Work limited by health 1984 0.1
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161 The characteristics of the SYET
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163 para-professional Mother not em
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165 comparison group where the shar
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167 5.5.4 Attrition: natural attrit
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169 both sources that impose change
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171 para-professional Father not em
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173 work in later sections, this su
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175 Table 5.6: Effect of selection/
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177 appropriate to discard these fr
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179 Australia/Tasmania. Amongst tho
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181 Table 5.5a Summary statistics b
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183 5.6.1.2 Effects of the non-resp
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185 3 years + -0.35 -0.47 -0.34 -0.
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187 5.7 Multivariate analysis of ef
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189 proportion of time spent unempl
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191 post-school qualification, and
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193 Generally, those variables foun
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195 longj0 Longest job by 1984 < 1
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197 adopted in order to maintain co
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199 6: Study 4 Weighting to counter
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201 Table 6.1, part A Employment eq
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203 Methodist 0.133 0.261 (0.77) (1
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205 CEP referrals 1984 0.143* 0.128
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207 6.2 Results of weighting the PS
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209 The distribution of the propens
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211 Table 6.3 Weighted probit used
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213 (0.76) Tradesperson mtrad 0.20
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215 Table 6.5 Summary statistics fo
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217 Table 6.7 Matching results, sin
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219 6.3 Discussion The comparison o
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221 the selection into SYETP and th
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223 Heteroskedasticity is a violati
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225 Table 7.1, Part A Employment eq
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227 (1.26) (1.28) (1.16) Mothers oc
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229 Other Post-School qualification
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231 7.1.2 Exclusion restriction in
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233 Finally, the third panel of new
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235 Table 7.2 summary of changes to
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237 schooling that was statisticall
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239 (0.25) (0.21) 3 years + -0.50 -
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241 Table 7.4 Summary of distributi
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243 7.2.2 Propensity score matching
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245 original model, but with the pe
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247 maintained, then the Heckman bi
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249 Table 7.6 Weighted Probit used
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251 Table 7.7 Summary of distributi
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253 8: Summary and Conclusions The
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255 over which it ran, the review m
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257 the Heckman and PSM methods wer
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259 posited that that such sensitiv
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261 Description Derivation and deta
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Appendix 2 Tables 263
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2 years 0.28 0.07 (1.70) (1.70) 3 y
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267 Table A2.0b Univariate Probit o
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269 Religion brought up in (1.52) (
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271 hq9_84 Year 9 of school or less
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273 Table A2.1 Continued Means and
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275 mtrad Tradesperson 0.04 0.04 0.
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277 Year 9 of school or less -0.19
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279 Table A2.3 Probit of SYETP part
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281 (0.22) (0.44) (0.67) (0.89) Tra
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283 Table A2.5a Univariate probit f
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285 Manager/professional/para-profe
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3 years + -0.04 (2.13)* CEP referra
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289 Table A2.6 Part A Employment eq
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291 Table A2.6 Part B Selection/par
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301
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BLMR Bureau of Labour Market Resear
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Fay, R.G. (1996) "Enhancing the eff
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Heckman J.J. and Smith, J. A. (1998
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Lewis, H.G. (1963) "Unionism and re
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Quandt, R. (1972) "A new approach t
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Stromback, M. and Dockery, A. (2000
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