"Unpacking the small effects of subsidized employment : the role of gender and parenthood"
joint with Sarah Gharbi and Valentina Melentyeva (University of Cologne and Excellence Cluster ECONtribute)

Abstract : Subsidized employment has been widely used to tackle unemployment. Nevertheless, our understanding of the gender-specific effects of these policies remains limited. In this study, we assess the impact of a subsidized employment program in France allowing for heterogeneous effects across gender. We apply a dynamic difference-in-differences approach where older non-participating cohorts serve as a control group. Starting with the average effects, our findings reveal robust positive effects on annual earnings, and working hours following program completion. However, the effect on the employment probability — the primary objective of these policies — is close to 0 and only marginally significant. When considering gender heterogeneity, our analysis indicates significant and positive effects on all outcomes for men. For women, the program fails to enhance the likelihood of employment. As parenthood is a major factor in gender inequality within the labor market, we investigate the influence of childbirth. Our analysis shows that the lack of impact on employment probability is due to smaller effects for fathers and especially mothers, who do not experience improved job prospects. Childless young men see their situation significantly improved. Women giving birth during the program turn out to be worse off at the end of the program.