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In this study, we investigate the exit rates from unemployment associated with different levels of education in Belgium during two periods characterised respectively by high (2002-2007) and low economic growth (2009-2014). Our estimated exit probabilities confirm that the chances of leaving unemployment are substantially higher for young unemployed who have followed post-secondary education. Moreover, the probabilities of leaving unemployment for low- and medium-skilled school leavers considerably deteriorated between the two periods. On the one hand, the penalty associated with lower education slightly increased while, on the other hand, the advantage associated with postgraduate tertiary education reinforced itself. Finally, our results show considerable heterogeneity according to region of residence and gender.
This paper assesses to which extent the policy of reducing employers’ social security contributions has increased market sector employment in 1995-2000. The analytical framework is a macroeconometric labour market model of the market sector that models added value, the employment of labour and capital, the setting of wages and prices, the matching of supply and demand on the labour market, and the dynamics that tie short-run behaviour to the steady state. The real wage cost depends on the wage gap, labour productivity, the replacement rate of unemployment benefits to the take home wage, and tensions on the labour market. The model comes in two versions. The ‘right-to-manage’ version links the wage cost to the unemployment rate; the ‘job-search’ version ties the wage cost to the unemployment-vacancy-ratio.