Working Paper #19-2018
Remote Work Grant - Midterm Report
Naomi Gershoni, Itay Saporta-Eksten and Analia Schlosser
In 2016, the Israeli Employment Service (IES) began operating the Remote Work Grant program targeted at peripheral areas in Israel. This program enables job seekers in the target areas to receive a monthly grant of 600 ILS for a period of 5 months, if they successfully maintain a job at a workplace located outside the limits of their locality of residence. Following a pilot in Yeruham’s and Shefaram’s employment offices of the IES, the program was gradually extended (starting November 2016) to a total of 26 employment offices nationwide.
The effectiveness of the program is assessed by a Randomized Controlled Trial (RCT) where the target population is randomly allocated into a treatment group (individuals eligible for a grant if criteria is met) and a control group (non-eligible). This report summarizes preliminary findings of the program’s effect based on a comparison between the treatment and control groups. The analysis uses data from the IES to estimate the program’s effect on reporting to employment offices and to provide initial evaluation of the program’s costs relative to savings in welfare payments. In addition to data from the IES, surveys were conducted to collect data on the treatment and control groups: a baseline survey was administered prior to allocation to the program, and a follow-up survey was completed by individuals in treatment and control groups ten weeks after allocation to the program.
A full evaluation of the program requires a long-term follow up on the participants, accumulation of larger samples, as well as the use of administrative data on employment and wages, however, even at this stage, a number of key findings emerge:
- The program leads to a decrease in reporting to employment offices. Under certain assumptions, this decrease can be interpreted as an increase in employment, which will be further examined in a follow-up report. Five months after allocation to the program, the rate of reporting to employment offices of individuals who are eligible for a grant is 3 percentage points lower than the equivalent rate observed in the control group – a decrease of 4.5% relative to the rate of reporting in the control group of 66%.
- The highest decrease in reporting was found among long-term welfare recipients (guaranteed minimal income) and among Arab males. The program led to a 4 percentage points decrease in reporting among long-term welfare recipients, which amounts to a decrease of 4.7%, and to a 5 percentage points (7.5%) decrease among Arab males. Among Arab males, a 4 percentage points (8%) decrease in reporting was also identified for individuals eligible for unemployment benefits.
- A preliminary estimate of savings in welfare payments compared to program costs (based on reporting data 5 months after allocation), indicates a saving of 1,300 ILS per monthly grant among long-term welfare recipients. After 8 months, the saving for this group is 1,600 ILS.
- Preliminary results based on follow-up surveys administered 10 weeks after the allocation date indicate a significant increase in motivation and availability for work outside one’s locality of residence as well as in the number of job interviews outside one’s locality of residence in the group of participants eligible for a Remote Work Grant.