Aims: The paper estimates the impact of a supported employment programme implemented in Hungary. Methods: This is a non-experimental evaluation using a matching identification strategy supported by rich data on individual characteristics, personal employment and unemployment history and the local labour market situation. We use a time-window approach to ensure that programme participants and matched controls entered unemployment at the same point in time, and thus faced very similar labour market conditions. Results: We find that the programme had a positive effect of 16 percentage points on the probability of finding a job among men and 25 percentage points among women. The alternative outcome indicator of not re-entering the unemployment registry shows somewhat smaller effects in the case of women. Conclusions:In comparison to similarly costly programmes that do not facilitate employment in the primary labour market, rehabilitation services represent a viable alternative.
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