AROUND THE WORLD

 

Results of reform initiatives around the world

Similar reforms were implemented in various countries around the globe: in the USA, France, the Netherlands, Denmark, Norway and Britain.

 

USA:

The reform was launched in 1996, and achieved the following results:

The number of income support recipients fell from 12,900,000 in 1996 to 8,300,000 in 1998 (a drop of 38%). The unemployment rate dropped  from 5.6% in 1995 to 4.2% in 1999.

 

Britain:

A pilot program was launched following the passing of the Jobseekers Act in 1995. It initially included short-term programs for job seekers, and then developed (in 1998) into a comprehensive program called New Deal which encompasses the entire job market and the entire population of income support recipients. The program results were:

·         The number of support applicants dropped from 1,584,500 in 1997 to 970,000 in 2001 (a drop of 39%)

·         The percentage of support applicants among the general population dropped from 5.3% in 1997 to 3.2% in 2001.

·         The overall unemployment rate dropped from 8.7% in 1995 to 5.7% in 2000 (according to OECD data)

 

The Netherlands:

Implementation of the reform began in 1998, after the JEA Law was passed. The Law targeted job seekers, and especially young people, who constituted a large percentage of the unemployment allowance recipients in the country at the time. The program offered differential treatment according to age group, imposed sanctions on participants who refused to cooperate with its demands, and strove to create jobs and encourage employers.

·         The employment rate grew at a pace of 1.5% per year (comparable to the increase which occurred in the USA).

·         The unemployment rate dropped from 7.5% in 1994 to 2.3% in 2000 (and remained at the same level until 2002).

·         Among young people, the unemployment rate dropped from 11.1% to 6.1%.

It should be noted that, in this period, the average unemployment rate in the European Union dropped only from 11.1% to 10.6% (according to OECD data for 1999).

 

Norway:

Started to implement reforms in 1993, with the following results:

                               ¨         The unemployment rate dropped from 5% in 1995 to 3.3% in 1999.

                               ¨         The number of applicants for income support dropped from 177,700 in 1993 to 125,660 in 1999 (a drop of 30%)

 

Denmark:

 The reform was launched in 1998, and achieved the following result:

                               ¨         The rate of unemployment dropped from 7.3% in 1995 to 5.2% in 1999.