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Evaluating Cohesion Policy Impact on Employment Quality and Levels in Hungary

This paper assesses the effects of EU cohesion policy on employment in Hungary, focusing on job creation, stability, and quality. Using a mixed-methods approach, including surveys and econometric analysis, it evaluates interventions from 2004 to 2008, particularly enterprise and educational subsidies. Key findings highlight the significance of targeted support for SMEs and disadvantaged regions, although the overall perceived impact on fostering a knowledge-based economy remains critical. Preliminary data suggests created jobs often require low educational levels, raising questions on long-term employment quality and sustainability.

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Evaluating Cohesion Policy Impact on Employment Quality and Levels in Hungary

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  1. The effect of cohesion policy on the level and quality of employment in Hungary (TÁRKI- Kopint-Tárki- PPH consortium) Ex-post and midterm evaluation of EU developments in point of view of European Commission and Visegrad countries International evaluation conference Budapest, 6th May 2010 Peter Vakhal research associate, KOPINT-TÁRKI

  2. Scope of evaluation • Which interventions increase more efficiently the level of employment? • The effect of structural interventions on • Job creation • Employment stability • Quality of created / safeguarded jobs • Duration of created / safeguarded jobs

  3. The focus of evaluation • The operative programmes of economic competitiveness and human resource (between 2004 and 2008) The effect of interventions in case of • Enterprise subsidies • Subsidies on education

  4. The methodology of evaluation • Questionnaire distribution among the subsidized enterprises • Focus groups interviews with educational institutions • Secondary research by descriptive statistics and econometrics (PPH) • Case studies on best practices

  5. Focus of questionnaires • Number of created or safeguarded jobs by • Industrial sectors, • skill of employees, • age, gender, • special groups (handicap persons, long-term unemployment)

  6. Focus groups • Current trainings • Success or non-success trainings • Distribution of trainings by interests • New, not satisfied demands • One group in a well developed and one from a developing region • Trainings for employees with higher and lower educational level

  7. Secondary research (PPH) • Based on international literature • Separation of subsidies for employment and for other purposes • Dispersion of subsidies by descriptive statistics: which regions, areas, sectors and enterprises are subsidized? • Econometrics: analysis of the effect of employment subsidies by regressions

  8. Hypothesises • 15 hypotheses • Based on international literature • Not finished yet!

  9. 1. Hypothesis • The jobs would not be created without subsidies (thus, no deadweight-loss)

  10. 2. Hypothesis • Subsidies paid for enterprises have pseudo-employment effect only. Enterprises created only formal jobs.

  11. 3. Hypothesis • If subsidies aim SMEs, the effect of job creation is relatively higher than in case of transnational companies

  12. 4. Hypothesis • The main beneficiaries of the subsidies are employees with lower educational level.

  13. 5. Hypothesis • The effect of subsidies paid for the education of unemployed persons is lower than in case subsidies for safeguarding jobs.

  14. Instead of conclusion: some preliminary results I. • Number of questionnaires: cca. 150 • Number of safeguarded jobs: 5-10 on average • Number of created jobs: 3-4 on average • Educational level of safeguarded jobs: almost the entire is secondary • Educational level of created jobs: mainly primary • Public opinion: the subsidies do not contribute to the creation of a knowledge-base economy

  15. Instead of conclusion: some preliminary results of the secondary research (PPH) • The labour-intensive companies get higher subsidies in the programmes • Companies positioned in areas with worse labour market get higher subsidies in the programmes • The employment effect of the programs differs from zero

  16. Thank you for your attention! Kopint-Tárki – PPH - TÁRKI Budapest, 6th May 2010.

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