According to NIK the activation of unemployed persons rarely helps them keep their job afterwards. The activation is considered effective if the unemployed person found a job in the free market within three months of completing the activation programme and was not re-registered as unemployed at that time. From 2011 to 2013, the effectiveness of internships measured by NIK ranged from 33 to 39 percent and as for training programmes it was from 18 to 21 percent. After a year of completing the activation programme the effectiveness ratios were even lower: 23 to 29 percent of persons after internships and 12 to 17 percent of persons who had completed training programmes still had a job.
The Ministry of Labour and Social Policy does not have reliable knowledge of the activation results. In line with NIK’s calculations, the ministerial effectiveness ratio for internships and training programmes is overestimated by nearly one third (from 17 to 27 percent). It is the case because the IT system used by the Ministry counts all persons removed from the register of the unemployed, including the ones who were qualified for one of the activation projects but not necessarily found a permanent job.
Also the data showing effectiveness of different forms of job activation are inflated. It applies among others to the creation of jobs and one-off start-up grants and also - to a smaller degree – to public works and intervention jobs. These forms of job activation are considered effective already at the time of granting funds, no matter how many persons found a job afterwards and for how long. As a consequence, the effectiveness ratio is understood as the number of created jobs, instead of the actual number of the unemployed who found a job thanks to the activation. In practice the persons “hired” in that way re-register as unemployed a few days later. According to NIK the employment effectiveness ratio should show the effect which is finding a job after the activation project has been completed.
The audit also revealed an unacceptable and, sadly, a very common practice of misusing internships as a way to hire unpaid workforce. The employers covered by the audit did not have to pay for internships (they were paid from the Labour Fund) and so they eagerly got involved in this kind of job activation. the NIK report shows clearly, though, that the employers were driven by their own profits. Many of them organised – in collaboration with job centres - fifty or more internships and admitted tens of unemployed persons for each. After the activation programme finished they usually employed just a few interns, or none at all. The jobcentres tolerated such practices as they wanted to cater to basic needs of the unemployed and their families, at least on an ad hoc basis. By law, an internship organiser has no legal obligation to hire an intern. Also, the jobcentres have no legal instruments to demand that. NIK has noted, though, that the jobcentres may – upon signing contracts with the internship organisers - prefer the employers which keep their promise to hire interns.
Most jobcentres did not conduct long-term monitoring of persons covered by the job activation programme. That is why, they do not know what happened to the persons who did not re-register as unemployed. NIK underscores that the monitoring would help measure effectiveness of different activation efforts as well as make it possible to evaluate reliability of employers and also improve credibility of statistical data.
According to NIK it is crucial to:
- make sure the activation effectiveness ratio also deals with durability of the activation results,
- make sure employers stop treating internships of unemployed persons as a way to hire unpaid workforce,
- change the principles of calculating the employment effectiveness ratio so that it reflects the actual number of unemployed persons covered by job activation, not only the job creation as such.
In 2014 significant amendments were made to the Act on employment promotion and labour market institutions. Nevertheless, NIK’s remarks and recommendations remain valid.
