The Influence of Different Compensation Levels of Unemployment Benefits on Job Chances among Unemployed Youth: A Comparative Study of the Nordic Countries

Abstract

Comparative surveys of unemployed youth were carried out in 1995-96 in the five Nordic countries. Representative samples of 1,500 to 3,000 registered unemployed, aged 18 to 24 years old, were drawn from the national unemployment registers in each country in the spring of 1995, and respondents were interviewed 6 to 12 months later. The article examines the influence of receiving unemployment benefits upon job chances of the previously unemployed. Danish youth (with compensation levels of 90 per cent) reported fewer financial problems than youth in the other countries with much lower compensation levels. The results document a decrease in the probability of re-employment for unemployed youth receiving unemployment benefits, even controlling for age, educational level, work commitment, job-seeking and duration of unemployment. The effect was significantly stronger in Denmark than in the other countries with lower compensation levels. However, in the other countries, receiving social assistance and having financial problems had an equally negative impact on re- employment.

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