Employment Subsidies and Job Insertion of Higher Education Graduates in the Labor Market

Anis Khayati (), Umme Hani, Md Shabbir Alam, Nadia Sha and Chokri Terzi
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Anis Khayati: Department of Economics & Finance, College of Business, University of Bahrain, Sakhir 32038, Bahrain
Umme Hani: Department of Finance, College of Administrative and Financial Sciences, Saudi Electronic University, Medina 93499, Saudi Arabia
Md Shabbir Alam: Department of Economics & Finance, College of Business, University of Bahrain, Sakhir 32038, Bahrain
Nadia Sha: Department of Finance and Economics, College of Commerce and Business Administration, Dhofar University, Salalah 211, Oman
Chokri Terzi: Quantitative Methods Department, Faculty of Economics and Management of Nabeul, Carthage University, Carthage 1054, Tunisia

Economies, 2024, vol. 12, issue 11, 1-13

Abstract: This paper uses data from the 24 governorates in Tunisia over the period 2012–2020 to study the relationship between job insertion of higher education graduates into the formal labor market and a number of independent variables, namely active labor supply, labor demand, an active labor market policy program (named the CIVP program), and the waiting time for job insertion. The balanced panel, which includes 216 observations for each variable, was the basis of different tests and estimations. The results of the tests allowed the assessment of a fixed effects model and a long-term relationship using FMOLS and VECM models. Results show that, in the long term, active labor supply and the CIVP program have positive effects on the job insertion of higher education graduates. In contrast, the results in the short term do not appear significant, with a negative effect of the CIVP program that reflects the fact that companies exploit most of the benefits of this wage subsidy program on job insertion before final recruitment. Using the ARDL model, the individual results by governate show specific differences across areas.

Keywords: employment subsidies; active labor market policies; graduate unemployment; MENA region; Tunisia (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2024
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